Lords Sitting of 1 July 1992

Preamble
The House met at half-past two of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Guildford.

Lord Healey
The Right Honourable Denis Winston Healey, CH, MBE, having been created Baron Healey, of Riddlesden in the County of West Yorkshire, for life—Was, in his robes, introduced between the Earl of Longford and the Lord Cledwyn of Penrhos.

Lord Howe of Aberavon
The Right Honourable Sir Richard Edward Geoffrey Howe, QC, having been created Baron Howe of Aberavon, of Tandridge in the County of Surrey, for life—Was, in his robes, introduced between the Lord Crickhowell and the Lord Jenkin of Roding.
Noble Lords Noble Lords— Took the Oath.

London Minicabs: User Safety Report
Baroness Gardner of Parkes Baroness Gardner of Parkes asked Her Majesty's Government:
When the recommendations of the working party on the safety of users of minicabs in London will be published.
The Minister of State, Department of Transport (The Earl of Caithness): My Lords, the Government have recently received the report of the working party. It will be carefully studied and publication will be arranged shortly.
Baroness Gardner of Parkes: My Lords, I thank my noble friend for that reply. As he knows, this House has waited patiently for this report. We are most anxious that the Government should press on with this matter. Will my noble friend assure me that the Government will do everything possible to ensure a higher standard of safety for passengers travelling in minicabs? Will they also ensure that standards are raised in all forms of passenger transport in London?
The Earl of Caithness: My Lords, we take the question of safety extremely seriously. This very afternoon my honourable friend the Minister with responsibility for transport in London is holding a meeting on the subject.
Lord Ennals: My Lords, is the Minister aware that London Hackney cabs have made much progress in providing facilities for disabled people? Do the terms of reference of the inquiry on minicabs, and of the report, include the safety and welfare of disabled people?
The Earl of Caithness: My Lords, with regard to the noble Lord's first question, the answer is yes. In
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answer to his second question, I have said that the publication of the report will be announced shortly and the noble Lord will be able to read it for himself to see whether the matter of disabled people has been addressed. However, I can assure the noble Lord, and the House, that the question of disabled people is very much at the forefront of our minds.
Baroness Hamwee: My Lords, is the Minister aware that concern for safety has led to the establishment of a number of minicab firms operating with women only drivers, even though that is not necessarily an answer to the safety problem as women are not necessarily more reliable than men in that respect? Is the Minister further aware that it is not possible for minicab firms to advertise solely for women drivers without infringing the sex discrimination legislation? Does the Minister agree that if the Government were to proceed quickly with the recommendations of the report passengers would be reassured? There would also be the added benefit that a piece of legislation would not be brought into disrepute, as it is now.
The Earl of Caithness: My Lords, with regard to the first two questions of the noble Baroness, the answer is yes. With regard to her third question, we hope to publish the report shortly.
Lord Underhill: My Lords, we welcome the fact that the report will be published shortly. Will the report be made available for public discussion before the Government move on legislation? That is an important matter that we should consider, though I appreciate that the Minister cannot give us a definite statement today on the Government's decision. However, the working party was set up as a result of the efforts of the Suzy Lamplugh Trust, which is concerned with the safety of passengers, particularly in minicabs. Will the Government therefore bear in mind the fact that the public strongly desire legislation that will bring the minicab trade into line with the black cab trade? At the same time, does the Minister agree that nothing should be done to weaken the position of the black cabs, which give a grand service to the people of London?
The Earl of Caithness: My Lords, the answers to the noble Lord's questions will depend on the Government's decision. I have taken careful note of what he said.
Baroness Gardner of Parkes: My Lords, is the Minister aware that last year the report was published the day after this House rose for the parliamentary Recess and that we all found that unsatisfactory? Can he assure us that this time it will be published and we shall have it before the Recess?
The Earl of Caithness: My Lords, again, I take note of what my noble friend said. As I have just told the House, a meeting is taking place this afternoon on that subject.

The Falkland Islands and Argentina
3.5 p.m.
Lord Boyd-Carpenter Lord Boyd-Carpenter asked Her Majesty's Government:
Whether the Argentine has now dropped its claim to the Falkland Islands.
The Minister of State, Foreign and Commonwealth Office (Baroness Chalker of Wallasey): No, my Lords. I regret that Argentina has not dropped her claim.
Lord Boyd-Carpenter: My Lords, I thank my noble friend for that reply. Can she assure the House that in the circumstances Her Majesty's Government are making sufficient defence arrangements to make sure that if a second Galtieri-type putsch were attempted it would suffer the fate of the first?
Baroness Chalker of Wallasey: My Lords, I thank my noble friend for his supplementary question. I can assure him that Her Majesty's Government remain fully committed to the defence and security of the islands. We have adequate resources. We hope that we shall never have to use them again but we would obviously be prepared to do so if the circumstances arose.
Lord Cledwyn of Penrhos: My Lords, can the noble Baroness say whether any arrangements have been made for Ministers to meet Ministers of the Argentine Government? Can she further say whether progress has been made on the issues of fishing rights and oil exploration?
Baroness Chalker of Wallasey: My Lords, to answer the noble Lord's second question first, the issue of licences in the Falkland Islands control zone is decided by the Falkland Islands Government. The revenue from fisheries is doing well. It went up in 1991–92 to some £25 million. The fisheries income is being well used for secondary schools and other necessary needs of the Falkland Islands. Our agreement is certainly good. We also have an agreement with the Argentine to co-operate in order to preserve fish stocks in the South-West Atlantic.
I believe that the noble Lord will know that my right honourable friend the Prime Minister and the President of Argentina met at the Rio summit, very briefly, and there is a chance that the President will visit this country if relationships continue to improve.
Lord Swinfen: My Lords, my noble friend said that we would be perfectly prepared to defend the Falkland Islands if they were threatened again. Bearing in mind the size of the British merchant fleet, are the Government satisfied that we would have the capability of moving sufficient troops to the Falklands as and when required?
Baroness Chalker of Wallasey: My Lords, to the best of my knowledge we are able to do so if necessary. But we sincerely hope that it will never again be necessary.
Viscount Montgomery of Alamein: My Lords, is my noble friend aware that before the unfortunate conflict
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Argentina was a most important trading partner for Britain? Does she agree that, since the restoration of diplomatic relations, trade has started to pick up and there is now a spectacular opportunity for increasing trade, which is of great importance to the United Kingdom?
Baroness Chalker of Wallasey: My Lords, my noble friend is indeed right. There has been a significant recovery in trade. Several trade missions have taken place in both directions, including one to Argentina in March last year led by my right honourable friend the then Minister for Trade, Mr. Sainsbury. There was also a British Week in Buenos Aires arranged by the private sector. In addition, there is an investment promotion and protection agreement which was signed by the then Foreign Secretary of the Argentine, Dr. Cavallo, in December 1990. We certainly hope that the privatisation programme of the Argentine will offer many opportunities for UK industry and that UK industry will take them up.
Lord Williams of Elvel: My Lords, will the noble Baroness expand a little on her Answer as to whether it is possible for us to mount the kind of expedition to the Falklands that we mounted in the early 1980s? Do we have the naval resources? Do we have the merchant fleet? Do we have the right kind of army? Does she agree that from all the evidence that we have received so far it would be impossible today to mount an equivalent operation?
Baroness Chalker of Wallasey: My Lords, I fear that the noble Lord is a little misinformed. The best advice available to me is that at the present time, if we had to, we certainly could mount such an exercise again. But I repeat that we should be working for the positive, constructive relationship which seems to be coming between ourselves and the Argentines so that it will never again be necessary.
Lord Gisborough: My Lords, does the Minister agree that it is much more important that we should have the forces there to deter an attack in the first place? Can she confirm that the forces are there and are adequate to deter an attack?
Baroness Chalker of Wallasey: My Lords, yes, we have forces there adequate to deter. We remain fully committed to that. We have no plans to reduce the garrison, although, as everywhere, force levels are always kept under review.
Lord Boyd-Carpenter: My Lords, will my noble friend make it clear that not only do we have the forces available if necessary to defend the islands but that in the event of operations being necessary they will not necessarily be confined to the vicinity of the islands?
Baroness Chalker of Wallasey: My Lords, it would be very dangerous for me, even in response to my noble friend, to speculate on that matter. I can assure him that both the Ministry of Defence and the Foreign and Commonwealth Office have their eyes firmly on the situation.

Channel Tunnel: Safety
3.12 p.m.
Lord Hayter Lord Hayter asked Her Majesty's Government:
Whether they are satisfied with safety arrangements in respect of persons travelling through the Channel Tunnel.
The Earl of Caithness: My Lords, the Government have from the outset considered that the safety of travellers in the Channel Tunnel should have the highest priority. An independent Channel Tunnel safety authority of United Kingdom and French experts was established under the Treaty of Canterbury and provides specialist advice on all safety aspects of the Channel Tunnel.
Lord Hayter: My Lords, does the Minister agree that one way of allaying the common anxieties about terrorism and fire felt by passengers who may be going through the Channel Tunnel would be for the safety authority to issue a public report and in particular to emphasise the research and tests upon which it was based?
The Earl of Caithness: My Lords, as the noble Lord will be aware, the safety authority prepares annual reports that are published.
Lord Clinton-Davis: My Lords, can the Minister indicate whether Eurotunnel, which has usually been responsive to criticisms and has sought to engage the attention of the public, particularly at its headquarters in Folkestone, has met the criticisms made by the Select Committee of this House on the question of safety? Secondly, the Minister said that the safety authority is independent and objective. Does he agree that it is in a precisely comparable position to other bodies of that kind, such as the Civil Aviation Authority and the Health and Safety Executive?
The Earl of Caithness: My Lords, my answer to the noble Lord's second question is no, because it is a joint authority between the French and ourselves. That puts it into a totally different category from those bodies mentioned by the noble Lord. With regard to his first question, I do not have an up-to-date analysis of exactly what Eurotunnel has done. However, its commercial responsibility is to implement safety to the highest standards.
Lord Tordoff: My Lords, are the Government satisfied that the design of the trains at all stages has taken into account the specialist advice from the safety and human factor inquiry that I understand has already taken place?
The Earl of Caithness: My Lords, there are a number of safety aspects that need to be taken into account with regard to the train. They are assessed by the safety authority. It will look at every representation put to it.
The Earl of Cork and Orrery: My Lords, are Her Majesty's Government satisfied or will they insist on
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being satisfied that the fire risk will be no greater than it would be if passengers were to be segregated from their cars?
The Earl of Caithness: My Lords, my noble friend raises an important point about fire. That is why we have on the safety authority a very good expert—one of the country's best experts—with regard to fire.

The Army: Combat Forces
3.15 p.m.
Lord Wedgwood Lord Wedgwood asked Her Majesty's Government:
Whether they are reconsidering Options for Change and their plans for the future strength of the Army.
The Parliamentary Under-Secretary of State, Ministry of Defence (Viscount Cranborne): My Lords, last year's decisions on the restructuring of the armed forces took account of changes in the international security environment and the need to provide forces relevant to the challenge of the mid-1990s and beyond. My right honourable friend the Secretary of State for Defence has recently made clear in another place the importance that the Government attach to ensuring that future force levels are appropriate to the demands placed on the armed forces and that he intends to keep that requirement firmly in mind.
Lord Wedgwood: My Lords, I am grateful to the Minister for his helpful reply. Does he agree that our combat forces are currently experiencing unacceptable levels of overstretch, especially the infantry, which bears the brunt of all our military activity? Does he further agree that, owing to the emergency operational requirements, our forces, including those in Germany, are considerably depleted to the point where we cannot reasonably deploy a well trained and co-ordinated task force at the request of either NATO or the WEU?
Viscount Cranborne: My Lords, I am grateful to my noble friend for his remarks. The question of overstretch is constantly in our minds. I draw the attention of your Lordships and my noble friend in particular to the very high degree of capability and equipment that will be available to the first British division, which is the principle contribution that we expect to make to the Rapid Reaction Corps. I agree with my noble friend as far as his remarks about the infantry are concerned, and I also pay tribute to them.
One of the principal measures of overstretch is the tour interval that infantry battalions have to take during the course of emergency tour plots in Northern Ireland. There are a number of battalions which have not taken part in the less than 24 month interval which has been the benchmark of late in Northern Ireland, stretching back in some cases to January 1987.
Lord Bramall: My Lords, in the light of his answer, is the noble Viscount aware that there are as of now battalions continuing to serve in Northern Ireland which have done no fewer than four tours there in the past two and a half years with tour intervals of as little as six months to eight months? Does he agree that that

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represents as severe an overstretch as can be remembered since the troubles started and that is a very long way indeed from the hoped for two-year intervals forecast by Ministers in various Statements?
Is the Minister also aware that individual battalions of the King's Division, retained in the order of battle presumably because they had very good recruiting figures, now have to be reinforced by up to 100 men each from regiments of other divisions, merely to make them fit for duty? Finally, does the Minister appreciate that capping recruiting, as is now being done, presumably in a desperate attempt to get down to the manifestly inadequate and unworkable ceiling of 116,000, will inevitably lead to fewer units which are even weaker and further below establishment? If all that is not sufficient for the Government to do something now, will he tell us what is?
Viscount Cranborne: My Lords, as always, I am grateful for the advice of the noble and gallant Lord in these matters, in which he is a considerable expert. I hesitate to bandy examples with him. However, quite apart from the examples that he gives, battalions such as the 1st Grenadier Guards, the 2nd Battalion Grenadiers, the Royal Scots and the Royal Regiment of Wales have not been back in Northern Ireland since January 1987 and April 1988 respectively. There are examples on both sides. Once the drawdown has happened and we have got from here to there, the tour interval will once again increase. The element of overstretch is always in our minds.
Lord Campbell of Croy: My Lords, when, as seems very likely, more infantry are needed for international peacekeeping and other tasks, will the Government take into account records of recruitment and, equally important, retention in both of which aspects the Scottish regiments have excelled?
Viscount Cranborne: My Lords, I am grateful to my noble friend. After drawdown has occurred, the proportion of the Army occupied by Scottish regiments will be at least as high, and in some cases higher, in terms of the armoured corps than it is in the present Army.
Lord Hunt: My Lords, although it is slightly wide of the Question, perhaps I may ask this. Since reference has been made to service in Northern Ireland, does the noble Viscount agree that this is a good opportunity to pay tribute to the work of the Ulster Defence Regiment, now to be abolished after 23 years' service, despite the fact that its reputation has been slightly tarnished by the actions of some few individuals in that regiment?
Viscount Cranborne: My Lords. I am most grateful to the noble Lord for the opportunity that he gives me to pay an unreserved tribute to the performance of the Ulster Defence Regiment during the years of its history. I am delighted to hear that your Lordships fully subscribe to that view. The amalgamation that is taking place between the Ulster Defence Regiment and the Royal Irish Rangers is proceeding well. We
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look forward very much to the best traditions of both those magnificent regiments being continued in the amalgamated unit.
Lord Williams of Elvel: My Lords, does the noble Viscount accept that Options for Change has drawn intense and sometimes ferocious criticism from all political parties, from the Select Committee on Defence in another place, and, as we have heard today from the noble and gallant Lord, Lord Bramall, from distinguished former service chiefs? In the light of that, is it true that the MoD has a committee at present reviewing Options for Change? If that is true, when may we expect its report to be leaked—as it surely will be?
Viscount Cranborne: My Lords, if it is true, the noble Lord, Lord Williams, is rather better informed than I am. I hesitate to admit that such a possibility could even exist.
However, I refer the noble Lord to the Answer that I gave to my noble friend's original Question. We are conscious that we live in an extremely uncertain world and that the demands on our defences are likely to change at short notice. As my right honourable and learned friend said in another place, we intend to keep that requirement firmly in mind.
With regard to the House of Commons Select Committee on Defence, I remind the noble Lord, Lord Williams, that when it examined the results of the Options for Change, it commended the Ministry of Defence, stating that the resultant army, both Regular and Territorial, would be outstandingly well equipped.
Lord Swinfen: My Lords, bearing in mind that problems often come from more than one direction at once, I ask this question. Were the troops committed to the ACE Rapid Reaction Corps to be fully committed with that force, from where would a balanced fighting force be obtained which might be required to go, for instance, to the aid of the Falkland Islands?
Viscount Cranborne: My Lords, with his experience in military matters, my noble friend will be well aware that it is impossible to guard against every possible eventuality. The Ministry of Defence has to make a judgment. It has made a judgment and believes that the judgment is at least adequate for our present purposes.
As I have to repeat to your Lordships in answer to every Question on the subject, the matter is permanently under review. If the circumstances change, we shall not hesitate to change our disposition.
Lord Mayhew: My Lords, is there not a strange contrast between the cuts in the Army and the proposed overall considerable increases in our nuclear capability? What is the explanation?
Viscount Cranborne: My Lords, the noble Lord, Lord Mayhew, knows at least as well as I do that our nuclear deterrent is the minimum necessary for credibility. That is consistent with our policy and will continue to be so.
Lord Mayhew: My Lords, perhaps I may follow that up. Is the noble Viscount aware that successive governments have described our deterrent as the minimum deterrent? Why do we now need a greater minimum deterrent?
Viscount Cranborne: My Lords, I hope that noble Lords will forgive me if I go down a rather recent memory lane in these exchanges. In previous exchanges in this place over the past few weeks, I have reminded the noble Lord, Lord Mayhew, of the considerable number of cuts in our nuclear capability that we have announced in the tactical and substrategic sphere. We have also emphasised that the present deployment of warheads, so far as concerns Trident, is very much the maximum.
Lord Stoddart of Swindon: My Lords, does the noble Lord agree that Options for Change was finalised during the euphoric period after the collapse of the Soviet military empire? Since then the world has realised that there are many dangers in other parts of the world. Are we sure that if the process of Options for Change continues, and indeed is not revised, we shall still have the forces necessary to meet those possible new needs?
Viscount Cranborne: My Lords, I am happy to agree with the noble Lord when he states that we live in a dangerous and uncertain world. It is for that reason that it is important, in particular in view of the danger of proliferation of nuclear weapons, that we should maintain our nuclear deterrent. At the same time it is important that we realise that our conventional forces should be flexible and capable of reacting to any threat that emerges. As your Lordships well know, the threat that is emerging nowadays is all the more dangerous because of its very uncertainty. In the wake of the fall of great empires, the world does not necessarily become a safer place.
Lord Cledwyn of Penrhos: My Lords, will the noble Viscount tell the House what consultations have taken place with the NATO countries on the implications of the new policy?
Viscount Cranborne: My Lords, I am grateful to the noble Lord, Lord Cledwyn. Consultations are constantly taking place with our allies. We still regard NATO as the cornerstone of our defence policy. On the whole, the cuts made by our NATO allies as a result of the events in the Soviet Union have been rather more severe than those that we contemplate.
Lord Cledwyn of Penrhos: My Lords, can we assume from what the noble Viscount said that our allies in NATO are in favour of Options for Change?
Viscount Cranborne: My Lords, the decision regarding Options for Change clearly has to be taken in the light of the overall plans within the NATO Alliance. It would be unwise for us to take those decisions in isolation from our NATO allies. Certainly that has not happened.
Lord Wedgwood: My Lords, does the Minister agree that one of the reasons that my right honourable
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friend the Prime Minister is reluctant to commit our combat forces to the Balkans is the current overstretch of those combat forces, especially the infantry?
Viscount Cranborne: My Lords, I am grateful to my noble friend for giving me that opportunity. Emphatically, the answer to his question is no.

Business
Lord Hesketh: My Lords, with the leave of the House, I should like to say a word about the two debates standing in the names of the noble Lord, Lord Bonham-Carter, and the noble Lord, Lord Ezra. As the mover is allowed 15 minutes and the Minister should rise to reply not less than 20 minutes before the scheduled end of the debate, in the case of both debates this means that all other speeches should he limited to a maximum of 12 minutes. If any noble Lord were to speak at greater length, he would be doing so at the expense of subsequent speakers in the debate. Perhaps I may once again draw noble Lords' attention to the fact that when the digital timing device shows "12" it means that we have entered the 13th minute.

Press Complaints Commission: Report
3.29 p.m.
Lord Bonham-Carter Lord Bonham-Carter rose to call attention to the First Annual Report of the Press Complaints Commission for 1991, and subsequent events; and to move for Papers.
The noble Lord said: My Lords, it is a very appropriate day on which to discuss the press and the media in general. I draw the attention of the noble Lord, Lord Wyatt of Weeford, to the fact that the impartiality of the BBC is at issue once more. Yesterday it announced on television, Radio 4 and the World Service that I was one of the sponsors of the noble Baroness, Lady Thatcher. That was an inaccuracy which the noble Lord, Lord Boyd-Carpenter, may regret, as indeed may the noble Baroness, Lady Thatcher.
In addition, this debate is taking place soon after the first annual report of the Press Complaints Commission. In June 1990 the Calcutt Committee recommended that the new Press Complaints Commission should be given 18 months in which to show that non-statutory regulation can be made to work effectively. That period ends in July and presumably the Government are now making up their mind about whether the press has passed that stiff test. It is, therefore, appropriate that today we should be able to debate what we believe should be done in this area before the Government reach their conclusion and while they are making up their mind. It is even possible that our discussion may influence them.
On 23rd June an interesting event took place. It was reported in the Guardian and in the Independent. At Aspen, Colorado, the News Corporation held a management conference on the threat to democratic capitalism posed by modern culture. Whether it discussed the Sun and the News of the World in that

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context is unknown to me. The important conference was attended by Mr. Murdoch, by the US Secretary of Defence, Mr. Cheney and by Mrs. Cheney. During the course of a speech on censorship, Mr. Chao, the newly-appointed president of Fox Television Network, produced a male stripper to illustrate vividly and in all his glory some point that he was trying to make. It was reported that Mrs. Cheney was visibly shocked. The editor of the News of the World, Miss Patsy Chapman, asked for the stripper's telephone number. Mr. Murdoch was not amused and Mr. Chao was sacked on the spot. The incident was not reported in the Murdoch press. Later Mr. Murdoch said, "There are limits".
Those words might well be the theme of our debate. There are limits, there must be limits and we must decide where they are drawn. There must be limits on intrusions of privacy, on manifest political bias, on the concentration of ownership and, above all, on cross-media ownership.
There are few people who would deny that the right to privacy is important in principle. But all too often, when that is practised, some well-worn excuses are produced. The most frequently used is that the revelation is in the public interest. That, I take it, is the first excuse to be used in respect of the recently prominent revelations about the marriage of the Prince of Wales and Princess Diana. We are told, for example, that before the war the British public were, to their detriment, kept in the dark about the relationship between the Prince of Wales and Mrs. Simpson. But even if it is in the public interest to be informed that all is not well with the marriage of the heir to the throne —and the opposite could well be argued—we do not need to be told about it in such detail; and in such intimate, trivial and unsubstantiated detail at that—
Noble Lords: Hear, hear!
Lord Bonham-Carter: My Lords, but when such reporting has upset a digestion which, in respect of such matters, is as strong as that of the noble Lord, Lord Wyatt of Weeford, there is genuine cause for anxiety.
A second excuse is that the trivia has already been published in a book. I respond simply by saying that there is a difference between the circulation of the Sunday Times and most books; that because it has been published in a book it is not necessary to publish it in a newspaper and, above all, as all free-marketeers know, that by paying £250,000 for such trash a market in garbage has been created. All too often the intrusion is not a matter of public interest but is concerned with invasions of the privacy of obscure and vulnerable people.
That having been said, there need to be limits to manifest and unbalanced political bias. That demands of proprietors an acknowledgment that ownership of a newspaper carries with it responsibilities which are different from the ownership of a fish and chip shop or membership of the Stock Exchange. Indeed, that was
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acknowledged specifically in the Fair Trading Act 1973. In this case, however, the excuses that have been wheeled out are less plausible.
The excuse produced for the blatant political bias of the tabloids during the previous election, including the Daily Mirror, was that it was harmless and that readers aim off for bias. That excuse was produced in the Independent. It was also stated that to say that readers are influenced by the tabloids is to insult their intelligence and that the blitz, as it was described, against Mr. Kinnock during the last four days of the election campaign had no impact. Frankly, I must confess that I find it preposterous to argue that newspapers indulge in political bias and propaganda which has no effect whatever; that Conservative Prime Ministers distribute honours to proprietors and editors who have no influence whatever; that advertisers advertise, publishers send books, cinemas and theatres send free tickets and dictators censor newspapers all for nothing whatever. That is an incredible proposition which I cannot accept. If, indeed, the wholesale distortion of news had no effect would the noble Viscount, Lord Rothermere, the noble Lord, Lord Stevens, and Mr. Murdoch indulge in it?
It is argued that despite political bias there have been times since the war when the Labour Party has won elections. But because someone has overcome a handicap does not mean that the handicap is less unfair or undesirable. In addition, I would add that the situation has deteriorated. In 1966 Mr. Wilson, as he then was, had the support of 43 per cent. of the press in circulation terms. By 1980 at least three-quarters of the press was Conservative. If in addition to that one owner—in this case Mr. Murdoch —has 31 per cent. of the daily circulation, 37 per cent. of the Sunday circulation and also controls Sky TV, not only does one have a highly-concentrated ownership, which is undesirable, but also cross-media ownership, which is also undesirable.
When the Broadcasting Bill passed through Parliament some of us argued that cross-media restrictions were fixed to accommodate Mr. Murdoch and that that brought with it apparent dangers which we tried to set forth. Recently in an important speech to the Royal Television Society Mr. Gregg Dyke gave his account of the negotiations for the television rights to the Premier League. He said:
"There is no doubt, and I repeat no doubt, that the Murdoch organisation offered Rick Parry, the Chief Executive of the Premier League, the support of Rupert Murdoch's, and I quote, '40 million copies of his papers a week' for the Premier League if BSkyB got the Premier League deal. BSkyB have denied this, but they would wouldn't they? Unfortunately, Mr. Parry did not understand the significance of what had been offered and he told a meeting of 22 club chairmen that that is what was offered. In other words, if BSkyB got the contract the editorial policy of the Murdoch papers would be organised to support the Premier League and with it the commercial interests of BSkyB".
That is precisely what News International said it would never do, both to the Sadler Committee and when the Bill was going through Parliament.
That is an example of a situation which can only be regarded as undesirable and dangerous. I should add that although Mr. Dyke is a significant and senior

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member of London Weekend Television and although he was speaking to the Royal Television Society, his speech was not reported in the Murdoch press.
But we need not despair; there is hope yet. During the Committee stage of the Broadcasting Bill, David Mellor, who was at that time in charge of the Bill and who is now responsible for broadcasting in a more elevated capacity, said:
"I do not think it right in principle to impose restrictions on the ownership of Sky Television or MTV, Mr. Maxwell's venture, straight away".
He conceded that, therefore, there was a time when legislation on cross-media ownership might be necessary and that it might be reasonable to require that Mr. Murdoch should keep either his newspapers or his television interests, but not both.
The criterion which he set forth was profitability. Today BSkyB is making a trading profit and, according to it, has a great financial future. Mr. Mellor went on to say in the same debate:
"Who knows what the future may hold? We are principled about this, in the sense that all the ownership restrictions are in a schedule to the Bill and any one of them can be changed by an affirmative resolution of both Houses".
He went on to say later:
"I am at some pains to say that I understand that there is a case on the other side of the argument,"—[Official Report, Commons, 9/5/90; col. 256.]—
That is the other side of the argument to which he was speaking.
Mr. Mellor is now in charge of broadcasting. I look forward to hearing whether he will live up to his words. I look forward to hearing this evening the way in which the Government's thoughts are moving. Although I understand that there are pressures in many quarters for a privacy Bill, on balance I believe that the dangers to which it would give rise outweigh the benefits which it might deliver.
I understand also that unrestrained political bias is undesirable, unfair and gives rise to much indignation. It is difficult to see what the law can do to curb that bias without endangering other more important liberties. By drawing attention to that we can try to urge upon the proprietors, above all, a measure of self restraint which is in so many fields the best bulwark of British liberties.
On the other hand, cross-media ownership is a totally different matter. There the law can and should operate and, indeed, it does operate within the United Kingdom. Only Mr. Murdoch is exempt and that is a matter which can and should be rectified as soon as possible. The question is whether or not Mr. Major dare strike, given the debt which his Government owe to the Tory tabloids for their support in the last election.
My Lords, I beg to move for Papers.
3.45 p.m.
Lord Stevens of Ludgate: My Lords, it gives me little pleasure, as your Lordships can imagine, to find myself rising once again in this House to discuss the issue of press behaviour. I am the chairman of United Newspapers which owns Express newspapers. Sadly, I am not a proprietor; I am a mere employee. It is sad that the press is once more under attack. And there are
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those, as ever, who would like to exploit recent unease at some aspects of press behaviour to impose new restrictions.
In May 1989, when we held our last major debate on this topic, I said that legislation was not the answer. I believe that as strongly now as I did then. Since then we have had the review of the Calcutt Committee. We have seen, on its recommendation, the establishment of a new regulatory body—the Press Complaints Commission—successor to the old Press Council.
Eighteen months ago the then Home Office Minister responsible warned that the press:
"was drinking in the last chance saloon".
One more supposedly false move, he implied, and on would come the handcuffs. I believe the Calcutt review and the setting up of the new watchdog body, under the noble Lord, Lord McGregor, forced the press into a useful process of self-examination and improvement.
Yet, here we are going round the same course again. I wonder why. Two recent events, it seems to me, provide the impetus for renewed calls for legislative action: the general election and the recent publication, with accompanying excitement, of Mr. Andrew Morton's book on the Princess of Wales. I should like to deal with these points in order. In taking the first, I assure noble Lords that although my remarks are of necessity about politics I do not wish to be party political.
It is no secret that many members of the Labour Party, and not a few in the Conservative Party, believe the Government were re-elected largely because of the efforts of their traditional supporters in Fleet Street. That is not my analysis of why the Conservatives won. In the immediate aftermath of the election, Labour Party leaders indicated their belief that much of the blame for their loss rested on the way the press represented or misrepresented Labour's programmes and policies. I believe that the Private Members' Bill tabled in another place—Freedom and Responsibility of the Press Bill—is born of this exasperation; though, of course, its rationalisation affects to address wider and more disinterested concerns. Like similar Bills before it, this one assumes that the heavy hand of the law can be used to force newspapers to uphold some arbitrary standards of impartiality and balance, as though in a vigorous and diverse press those matters can be measured by the centimetre.
The Bill, like others which support its aims, overlooks the practical difficulties involved in enforcing so-called rights of reply and the printing of lengthy corrections. Labour leaders alleged that the party's central economic policies had been distorted by the Tory press. Now, with passions cooling, some are starting to admit that the message, not the press, was at fault.
The concept of freedom of the press has always been consistent with the acceptance of partisanship on the part of individual newspapers. I assume that the Labour Party was happy about the partisan role of its newspaper supporters during the election. If the Labour Party really wishes to pay more than mere lip

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service to freedom of the press—a bulwark of our free society—it should be prepared to accept the partisanship of others in a cause other than its own.
Restrictions such as those favoured by this Bill and almost certainly by any other legislative process would be totally impractical to operate and would seriously impair the vigour, vivacity and diversity for which the press in this country is both famed and envied.
I turn now to the recent press coverage of the Princess of Wales and her marriage. I think it important to draw attention to one crucial point that seems to get brushed to one side in the rush to condemn the press. The whole controversy about reporting the state of that marriage was stirred by publication, and serialisation, of Andrew Morton's book. Yet hardly anyone, as far as I am aware, has ever thought it fit to suggest that the right to publish such a book be restricted by anything but the existing laws. Do would-be censors think that the press should not be free to report on the content of books that are legally published? As my noble friend Lord Glendevon said in his letter to The Times, this story was handed to the newspapers on a platter.
It seems odd to imply that information available to those willing to pay the price of a book should be withheld from the millions who pay over their 30p, or whatever, for their daily paper.
The Earl of Longford: My Lords, perhaps I may interrupt the noble Lord to ask whether he is justifying the serialisation of the book, as well as the publication.
Lord Stevens of Ludgate: My Lords, I am justifying the fact that it is correct for newspapers to both serialise and publish the book. As a competitor I wish the circulation of the Sunday Times was the same as that of the book.
To suggest that the press should have ignored the book, with its strong and apparently substantiated claims to special authority, is unrealistic and insulting to the public. The claims made in Mr. Morton's book —and not denied by Buckingham Palace, let alone any of the principals—are clearly of intense and legitimate interest. How could a free press worthy of the name ignore them?
Freedom of expression, of which freedom of the press is a part, is a precious and indispensable part of our open and democratic society. And we really must get over the habit of crying "foul" whenever the exercise of that freedom causes embarrassment or offends against the sense of people's sense of propriety. Occasional abuse is the price we pay for all our freedoms, not only freedom of the press. Let us not forget that there are already restrictions on this particular freedom. There are laws of libel, which many think already too repressive; laws governing contempt of court, and rules to protect our over-generous definition of official secrets. Above all that hangs, like a sword of Damocles, the power to turn the Press Complaints Commission into a statutory body. Yet some of those urging restrictions often talk as though we started from a position of total licence.
Let us make no mistake, laws to gag newspapers
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—albeit passed out of some well-meaning wish to protect privacy—would cripple newspapers' ability to unmask wrongdoing. Privacy laws, drafted to prevent intrusive and speculative reporting, might well protect the privacy of some blameless individuals, but they would undoubtedly succour wrongdoers as well.
I do not, or course, believe that press behaviour is at all times exemplary. It is a rough business, as it always has been. But the behaviour of most of this country's 2,000 or so newspapers gives, I believe, little cause for concern. If your Lordships think I speak from bias, allow me to quote a disinterested student of our scene, Mr. David Flint, chairman of the Australian Press Council, who concluded in a letter to The Times of 22nd June this year:
"Whatever their weaknesses, the British media need no new legislative shackles."
Finally, not only do I question the justification for these latest calls for action but I doubt their timing. In the present political circumstances, the last thing the Government should be doing is contemplating, even tentatively, misguided measures to weaken the press's capacity for frank and fearless reporting. For a government that has just won a fourth term to pass or allow legislation restricting press freedom would be a most worrying signal.
I believe that this latest upsurge of animosity towards the press is partial and exaggerated. Ministers should not be misled into thinking that it represents feelings widely or deeply held by the majority of the British people who, as always, will be best served by a press able to go about its task in a free and responsible manner. That does not mean that I do not believe that the press goes too far on occasions; and I also believe that in the case of Mr. Morton's book that it did so. We, the press, should, while maintaining our existing duties and obligations, try to avoid hysteria and the desire to follow the pack. We should be more pro-active and less reactive. The main criticism I have, and would accept, of recent events is that of tone rather than content. We for ourselves will seek to improve that.
3.54 p.m.
Lord Ardwick: My Lords, I am glad to see so many newspaper people engaging in this debate. There are quite a number of "old lags"; people who have, in Kipling's phrase, "given their heart to the old black art".
I agree with some of the points made by the noble Lord, Lord Stevens. For most of his speech I thought he was saying that all was for the best in the best of all possible worlds; though he admitted that occasionally things are not so good, when someone steps out of line and so forth. However, I believe that the noble Lord, Lord Stevens, is far too complacent.
I shall not engage on the political front. Many years ago the noble Lord, Lord Cudlipp, and I, and the late Lord Jacobson, got up to some pretty good tricks on the Daily Mirror in support of the Labour Party. The criticism of the press in its political conduct today is not so much what it does, but that so much of it is

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Conservative and so little supports the opposition parties. It is those proportions about which people are concerned.
I must thank the noble Lord, Lord Bonham-Carter, for initiating the debate, but not too heartily. I should have preferred to wait until the Government had fulfilled their promise to look at the way in which the commission was working and the response it was receiving from the press. Indeed, I hoped that the noble Lord would analyse the work of the commission and express a view about it. As far as I can recall, he said very little in that regard.
The Government's judgment is still to come. We shall probably discuss the commission again after October. By that time we should be able to see matters in perspective. The danger at this moment is that the anxieties aroused by the way the media have publicised the problems of the Royal family will swamp the discussion and we shall lose track of the progress made by the commission.
I regard the Royal story as an extraordinary event; something that may happen only once in a generation and perhaps not even once. It is clear that the marriage of the heir to the throne is under severe strain and neither the Prince nor his wife are concealing that fact. What is the press to do? Should it remain silent? Should it tell all? Or should it tell only some of the story? I shall return to that in a moment.
Problems concerning privacy, which is what the debate is all about, are not the only ones with which the commission is concerned. The voluntary code of practice which the Press Commission uses as its guide is also concerned with accuracy, fair opportunity to reply, the use of subterfuge to obtain information, harassment, payment for information, intrusion into grief or shock, interviewing children, the victims of crime, race and religious prejudice and financial journalism. That is plenty, is it not?
Anybody reading the commission's reports must be impressed by their clarity and concision, and the general reasonableness of the judgments. It is not afraid to turn down an MP or to condemn a practice of recent years when newspapers present collated information as though it were the result of an interview. The commission is not afraid to reject the complaint of a great bank. Some of the good work of the council is in resolving complaints directly without the need for adjudication by bringing the complainant and the newspaper together with a view to some form of satisfaction of the complaint being found.
Noble Lords may have heard on television or radio today the complaint of a Wimbledon star that a newspaper had published her address and members of the public had been exercising undue curiosity. In the current report of the commission the secretary of a football club made the same complaint—that his address was given in a newspaper. He was told by the commission that newspapers are generally entitled to publish names and addresses of people in the news and to do so is no breach of the code under which the commission operates. Harassment is often the price of fame.
All that is useful work. Perhaps it is asking too much for perfect consistency in the judgments, but to
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say a good word for the commission does not mean that all newspapers are behaving like angels. Here I am at one with the noble Lord, Lord Stevens. We have to remember that the democratic system is a pretty rough trade. Newspapers are an essential part of that system. They are also part of the roughness. Smooth them down and out goes democracy.
I return to the Royal problem. It is of course tragic that two such attractive young people with a young family and who carry out their public duties assiduously and with charm, should develop a serious incompatibility as apparently they have. We must all hope that it will be resolved in reconciliation. But, faced with this development and this story, I have to ask myself what I as an editor would have done with it. I should certainly have published the news. The fact that it was broken by the impending publication of a book was only incidental. The public conduct of the Prince and Princess was a sufficiently clear pointer to the marital situation and anything might have sparked off the news.
This may not be a constitutional matter, but it is one of considerable public interest and concern. However, if I had been presenting it I hope that I would have done so more gravely. It is not justifiable to report in detail every spat and every act of apparent coldness or rejection. It is even less justifiable to go into the details of the Princess's nervous symptoms and allegedly suicidal despair. When this is over newspapers should think about the ethics of Royal reporting. For the law of libel—the ordinary citizen's defence against untrue defamatory statements made against him—is virtually inoperable for the Royal Family.
A good deal of indignation is felt about some aspects of the behaviour of all the media, and not just the newspapers. I refer to the electronic media as well. Although no government are likely to legislate, some Private Member may find his privacy Bill speeding on its way through one of the Houses of Parliament. I have no faith in any such Bill. If it were effective it could only damage the serious newspapers making impossible the serious inquiries which have to be made in the public interest. I do not know of any acceptable sanction that the law can provide which will deter multi-millionaire companies from publishing the scandals that they know the public eagerly want to read.
4.3 p.m.
Lord Wyatt of Weeford: My Lords, I am sorry that the noble Lord, Lord Bonham-Carter, began his speech by the rather stale old repetition of attacks on Mr. Rupert Murdoch for being so successful. With that he coupled me, although I could not quite hear what he said. Therefore, I shall not bother to reply to that. I was pleased that the noble Lord, Lord Ardwick, addressed some of the real issues facing the discussion of the Press Complaints Commission. However, I do not for once agree with the noble Lord, Lord Stevens of Ludgate, though I usually do.
Since the Press Complaints Commission was set up it has made a pretty good job of enforcing most of the 16 clauses of its code of practice. Where it has failed,

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and will continue to fail, is with enforcing Clause 4 which deals with intrusions into privacy. Nine of its 16 members are closely associated with the press as editors or directors of press enterprises. A tenth member who, sadly, has recently died, was previously in charge of news and current affairs at the BBC, which did not give me much encouragement.
Circulations are falling. Intimate details of the private lives of the well-known or the unknown suddenly shot into prominence, are circulation boosters. It is against human nature to expect editors voluntarily to restrain themselves when they know that other editors will not. A slap on the wrist from the Press Complaints Commission is a small price for a quick circulation uplift of 200,000 to 300,000. When the Press Complaints Commission issued a statement condemning intrusions into the private lives of the Prince and Princess of Wales, editors laughed. They carried on as before. They knew that their rivals would do the same. They knew, too, that a Press Complaints Commission dominated by the media is, and must always be, a toothless dog in matters of privacy.
Editors will always vigorously pursue, with the aid of photographs, intrusions into privacy concerning intimate personal, family and sexual matters. Even the so-called quality newspapers like the Sunday Times do it all the time. Sir Ralph Halpern, when head of the Burton Group, was subjected to prolonged newspaper accounts of his sexual prowess with a bimbo. Apart from the severe distress it caused his family whatever he did with a bimbo, or she with him, had nothing whatever to do with his efficiency as head of an important company.
Present, or about-to-be, Members of your Lordships' House have suffered this kind of treatment —they know what I am talking about—and so have those in another place. The leader of the Liberal Party and his wife were monstrously tortured by the media over their private lives during the last election, though these could not in any sense have been a political issue. A lady in another place, the Member for Birmingham Ladywood, complained over a particularly virulent campaign about her sex life in the News of the World, for which I write weekly. Condemnation from the Press Complaints Commission was certainly printed but cheerfully shrugged off. Conduct of privacy issues appears not to have been altered by it.
Recently, a married football manager, while in and out of hospital, was hounded by sensational revelations that he had a mistress. When cricketers stay at hotels we get titillating gossip from female hotel workers about their after-play sexual play: bowling a maiden over and so forth. That has no connection with their cricketing or footballing skills. Footballers, cricketers, golfers, tennis players and every kind of sportsman or sportswoman are victims of lurid accounts of their sex lives. When chess becomes a mass sport we shall doubtless hear that in the evenings the chess players plot their next scandalous move in bed and not their next brilliant move on the chess board.
Sudden and spectacularly tragic and traumatic events in ordinary people's lives are instantly followed
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by intrusions of privacy. Even hospitals are invaded. Reporters and photographers burst into the homes of people innocent of the ways of the press. They report with glee the immediate disjointed reactions of those under great strain. They are bounced into saying things they would never say if they had had 24 hours' reflection first.
The Calcutt Committee on privacy reported in June 1990. It recommended a Press Complaints Commission. It said that this would be one final chance to prove that voluntary self-regulation could be made to work. The 18 months which the Press Complaints Commission was allotted to show that the media can behave decently ended yesterday. I have been writing articles for the press since I was 16. I love newspapers and I like most editors I meet. By nature I am an optimist, not a cynic, but I am certain that it will never be possible to ensure the right to privacy without a law to back it.
In France, it is a criminal offence to breach anyone's privacy in intimate, personal, family or sexual matters. Criminality began to take shape in the law in 1858 after intrusions into the privacy of the famous singer, Elise Rachel, who died of consumption that year. The criminal law in France has been invoked in numerous cases. Some have involved notabilities, such as Brigitte Bardot, Marlene Dietrich and a President of the French republic, but the law applies to all from the humblest to the highest. In France it is criminal even to send to the printing press anything which is a breach of privacy.
The French are amazed that the notorious book by Mr. Morton, Diana: Her True Story, got as far as the printing press, let alone was published and serialised. In France it would have been aborted before birth. That book is not only doing a great disservice to the Princess of Wales, whom it claims to support, by portraying her as slightly barmy, but it is also most unjust to the Prince of Wales. Naturally the public like to read such stuff. Indeed, I am very interested in other people's quarrels and should very much like to hear all about family arguments among my neighbours, but I have no right to a report on them and nor do they have the right to a report on the rows in my family. There is no right whatsoever to eavesdrop pointlessly for titillation. Such activities have nothing whatsoever to do with the public interest, only with what interests the public. That is a completely different subject.
The law in France does not affect investigations into the activities of scoundrels and wrongdoers and nor does it prevent publication of a true story of, say, a Cabinet Minister who is having an affair with a beautiful foreign spy or of a story about a Defence Minister being an alcoholic and therefore unfit for his post.
I am not a lawyer but I am sure that there are many lawyers both in your Lordships' House and outside it who could draft a satisfactory law of privacy preventing invasions of privacy. One such person is Mr. Justice Hoffmann. Such a law should protect children from being pestered at school by photographers and reporters or from reading about true or false shocking details of their parents' marriage, which must have a fearful and lasting effect on them all their

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lives. Such a law should include preventing the printing of transcripts of tape recordings of private conversations and of unauthorised photographs of people in private places. What possible excuse could there have been for printing a full-length photograph of the Princess of Wales in her swimsuit while bathing recently in the swimming pool of the British Embassy in Cairo? None.
The law that I envisage would not protect rogues like Mr. Robert Maxwell—the law in France does not provide protection for them—if his sex life came into significance because he was financing his bimbos with money stolen from the pension funds. That would be a perfectly legitimate subject to follow.
There is much feeling among the public that it is the Government's duty to bring in a Bill enshrining the right to personal privacy for everyone without affecting the essential freedoms of the press. As I have just said, the public enjoy reading such stuff, but they know perfectly well that they would hate to have it written about themselves. They think that it is utterly intolerable that such things should be written about people who are in no position to protect themselves and who cannot do anything about it, except bringing a libel action after the story has actually appeared.
If the Government do not bring in such a Bill, one should be promptly introduced into your Lordships' House. I believe that it would have all-party backing both here and in another place. I also believe that the public would greatly welcome this curb on the press. In saying that, I am unlike the noble Lord, Lord Stevens of Ludgate—once my noble friend—who thinks that that would be a way of censoring the press. The law that I am envisaging would have nothing to do with censoring the press when they are in pursuit of their legitimate interests—and nor would there be anything in it to stop the press following up reasonable and pertinent inquiries into people's lives, as happens in France. We are kidding ourselves if we believe that the poor little Press Complaints Commission will ever be able to satisfy the need for personal privacy.
4.15 p.m.
Lord Thomson of Monifieth: My Lords, I am not unsympathetic to the points that the noble Lord, Lord Wyatt of Weeford, has just made about particular examples of press excesses. However, in the remedy that he proposes, he seems not to have considered the fact that these matters were closely examined by the Calcutt committee, which came out firmly against a law that would create a tort of breach of privacy, and against a statutory right of reply as being impractical. However, the committee proposed that there should be a law to deal with physical intrusion in relation to the media and I support the committee in that.
The speeches that we have heard from a noble Lord who is a press proprietor and from another noble Lord who is a former distinguished editor illuminate the fact that this debate (which is, in effect, about the future of the Press Complaints Commission) goes right to the heart of one of the dilemmas of democracy. There can be no free society without a free press, yet all experience shows that it is impossible to
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have a free press without there being some abuses of that freedom from time to time. In extreme cases, these abuses can distort and undermine the very democracy that the free press is there to serve.
There is nothing particularly new about this situation. It is as old as parliamentary democracy. It was summed up a long time ago by the civil servant turned poet, Humbert Wolfe, who said:
"You cannot hope to bribe or twist
Thank God, the British journalist
But when you see what he will do
Unbribed—there's no occasion to".
The difficult question is how society can limit the inevitable excesses of a free press and keep them within acceptable levels.
It is necessary to bear in mind another dilemma. The noble Lord, Lord Wyatt of Weeford, who was a distinguished investigative journalist in his day, might ponder this dilemma—what one person regards as an outrageous invasion of privacy may be regarded by another person as a crusade in the public interest. It all depends on how one defines the public interest.
In our debate earlier this week on media intrusion in mental hospitals, I quoted the wise words of the noble and learned Lord, Lord Donaldson of Lymington, the Master of the Rolls, which were reported in the Calcutt committee's report. The noble and learned Lord said:
"The media are an essential foundation of any democracy. However they are peculiarly vulnerable to the error of confusing the public interest with their own interest".
As has been made clear in some of the speeches that we have heard already today, the press interest is to make profits in a highly competitive commercial business. The tabloids justify their excesses by saying that they are merely catering for the interests of their readers. However, as Stanley Baldwin once remarked of the press lords of his day, that is the argument of the harlot down the ages. It has nothing to do with any serious definition of the public interest. It may well be argued that the marriage of the heir to the throne is a legitimate matter of public interest, but that definition of the public interest cannot conceivably be extended to encompass the way in which the once reputable Sunday Times has turned tabloid over the book about the marriage. I agree with what the noble Lord, Lord Wyatt of Weeford, said about that aspect of this issue.
As a former chairman of the IBA, I was saddened to see ITN showing the peeping torn pictures of the Princess of Wales in the private swimming pool of the embassy, and then to see ITN publicly seeking to justify that as being a matter of public interest. Equally, how can obstructing the public highway by erecting scaffolding in order to allow cameras to peer over the walls of a school to see small children at their sports day be said to be in the public interest? It is such excesses by the press that have raised the issues we are debating today.
In tackling these issues the practical choice for Parliament and government lies, as the Calcutt Committee spelt out, between what it called a reformed non-statutory mechanism—the present Press Complaints Commission—and a statutory tribunal with statutory powers to implement a statutory code of conduct. It has to be said straight

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away that one of the many paradoxes relating to the media is that, although for the Government and Parliament to seek to regulate the press is basically repugnant to our traditions, the best way to encourage effective self-regulation is to threaten statutory regulation. That is what worked with the present Advertising Standards Authority, in which I declare a modest past interest as a former chairman. I notice that the noble Lord, Lord McGregor, has modelled his new Press Complaints Commission on the tried structure of the Advertising Standards Authority. It is worth looking at it as an example of how self-regulation can work.
If self-regulation is to be more than simply a cosmetic exercise—it can be made more than a cosmetic exercise—three things are essential. First, there is a need for an automatic source of funding through some kind of annual levy. One weakness of the former Press Council was that it had to go with a begging bowl to the newspapers of the country which it was supposed to regulate seeking the funds to enable it to do its job. The new organization—Pressbof—deals with that.
Secondly, there must be means of applying effectively an agreed code of practice. I am glad to see that the code lays down that when a complaint is upheld, the publication concerned is duty bound to print the adjudication which follows in full and with due prominence. I notice that the noble Lord, Lord Wyatt of Weeford, who knows about these matters intimately as a regular columnist in the News of the World, said that the newspaper he decorates chose to shrug off the complaint that was upheld against the News of the World in the case of the Member of Parliament, Clare Short. The News of the World printed some 3,000 words of the very full adjudication that the Press Complaints Commission gave on that matter. Nevertheless, more severe sanctions, including financial sanctions, may need to be considered as part of the weaponry of the Press Complaints Commission.
That brings me to the third and perhaps most important essential—a will to make self-regulation work on the part of the professional members of the commission. I found at the Advertising Standards Authority that the advertising industry members of the authority were as jealous as the lay members—and perhaps even more jealous—of the observation of its code of practice. Being more experienced than the lay members, they knew the tricks of the trade and therefore they were more effective.
The present Press Complaints Commission is still in its early days. It is suffering a baptism of fire and should be given more time to prove itself, encouraged no doubt by the continuing threat of legislation if it fails. But its success or failure will depend—I address my words to the noble Lord, Lord Stevens—on the editorial members and the press proprietors who are represented on the commission. It will depend on them being ready to back the code of practice in the spirit as well as in the letter.
If ever there is an area of democratic life that cries out for effective self-regulation, it is the media—not in the interests of the press; or even in the interests of the
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victims or targets of the press, legitimate or not legitimate. The real public interest, as properly defined for this country, is the interest in the principle of free speech and a free society. It would be a sad day if Britain felt compelled to resort to some form of governmental regulation of the press. It was on the very principle that the present Government withdrew some years ago from UNESCO in the face of a proposal of some kind of new world information order that would have meant direct intrusion by government into the way the press behaved. All over East and Central Europe a revolution is now taking place. The old state-controlled and state-censored press has disappeared. East and Central Europe is full of people trying to establish a free press for the first time. They now come here in considerable numbers to seek advice about how we try to combine freedom of the press with positive efforts to maintain standards. They come to the Press Complaints Commission in considerable numbers to seek advice there. It would be a great retreat to resort to statutory intervention at such a time.
I echo the words of my noble friend Lord Bonham-Carter in his opening speech. There is one area of the media where government intervention is legitimate and necessary—and that is to prevent excessive concentrations of media ownership, including cross-media ownership between the printed press and the broadcast media. In the recent Broadcasting Act the Government conceded an extraordinary degree of privilege to the Murdoch press in terms of its ownership of satellite broadcasting. Now the BBC is joining forces with the satellite broadcasters of the Murdoch press. Sporting events which previously the BBC and ITV in their different ways provided freely to viewers in this country will have to be paid for. Meanwhile, the new commercial television regime trembles on the edge of takeovers and mergers and the creation of mega regions.
These are issues of fundamental importance to the future freedom and diversity of our media. They are matters where the Government have a legitimate and necessary responsibility. I very much hope that the new Secretary of State for National Heritage will show a great deal more interest in accepting these responsibilities than his predecessor did at the Home Office.
4.27 p.m.
Lord Deedes: My Lords, I accept the point made by the noble Lord, Lord Thomson, about the diversity of the media but I think I am right in saying that this afternoon we are addressing ourselves primarily to the sins of the newspapers.
I begin by adding my thanks to the noble Lord, Lord Bonham-Carter, for initiating this debate. In the light of recent events there is indeed a need for a public discussion of some of the issues. I share many of the anxieties expressed by the noble Lords, Lord Thomson and Lord Wyatt of Weeford, not least because I am still a modest practitioner. I do not altogether share the contentment of my noble friend Lord Stevens of Ludgate. I prefer the realism of my noble friend Lord Wyatt of Weeford.

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There are a good many things that are wrong and it is not difficult to produce a washing list of what we have a right to hold against the press of today. But it is a great deal easier to recite what troubles us than to prescribe the right remedies. In the short time I intend to speak in this debate I prefer to dwell not upon the catalogue of our sins, not all of which I deny, but upon possible solutions.
As things stand, newspapers are under some sort of ultimatum. In the words of the Press Complaints Commission's annual report:
"By general parliamentary agreement, the Press, and the Commission with it, were both put on probation until the middle of 1992".
That takes us to where we are now. Failing the required level of conduct—we are to suppose—the Government will consider whether statutory under-pinning is required. That is generally accepted to mean —I accept the interpretation put on this by the noble Lord, Lord Wyatt of Weeford—restraints, by legislation, primarily on privacy. I accept the point. Privacy is the one area in which the Press Complaints Commission has a difficulty and has perhaps shown weakness. For at least two reasons I regard that position —the ultimatum—as unsatisfactory.
First, at the risk of causing hurt looks from my own Front Bench, I see no likelihood of this Government giving much encouragement to legislation which will antagonise the press. It is better to be blunt. The press did the Government pretty well in the previous election. I make no bones about that. No government in their senses bite the hand they feel has fed them. For that and other reasons, into which I shall not enter this afternoon, this talk of legislation (the ultimatum of the threat of immediate legislation) carries with it a great deal of bluff.
But let us suppose that it is not altogether bluff. Let us suppose that the Government are in earnest about this, and, if necessary, will support, or even initiate, a law on privacy. Then—speaking not as a lawyer, which I am not qualified to do, but as a practitioner —I advise your Lordships that the Government will be putting their foot into extremely slippery sand. I paid attention to what the noble Lord, Lord Wyatt of Weeford, said. I accept his point. With ingenuity, it might be possible to draft legislation which would meet some of your Lordships' anxieties about privacy and the invasion of privacy by the press. It could be done. It has been done. Drafts exist. What I doubt is whether the legislation would be easy to enforce.
My earlier training in the Home Office taught me that a law which satisfies public requirements but which is unenforceable in some respects is a thumping bad law. Even if the Government were willing—which I doubt—and the law could be drafted—which is possible—and could be made enforceable—which I doubt—there would be another hurdle to carry. How does one devise and enforce a law which protects the privacy of the individual without, at the same time, affording some refuge for rogues?
Lord Wyatt of Weeford: My Lords, if the noble Lord will allow me, he is making an interesting speech
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and I go along with a great deal of it. However, will he explain why it is that a law similar to the one I seek works in France?
Lord Deedes: My Lords, I am not being in the least didactic about this matter. I do not assert that a law that would defend privacy would necessarily pave the way for rogues. I am saying merely that there is a risk. If the existing law of defamation is buttressed by a law of privacy, there is an element of risk that more rogues will get away with what they are doing. I say bluntly that men such as the late Mr. Robert Maxwell would have reason to rejoice.
I do not say that we have played the role of watchdog with distinction in the past because, frankly, I do not believe that we have. That was a good example of where we failed in our duties. But it is a role that we should play and I should be sorry to see it handicapped by inadvertent legislation. So I come to this view: the Government would do themselves some good if they stopped pretending that they could, by legislation, control the ethics of the press. I am not defending the ethics of the press. There is a great deal about them which causes me, as a professional of some years standing, anxiety and unhappiness.
I should prefer to see the issue turned a little more towards the public's judgment. There is—shall I say? —a certain flaccidity today in public attitudes towards the press. The public deplores the cruel reporting of certain events which have been mentioned but reads about them avidly. I am for inculcating a degree more public responsibility into all this, which will not be exercised while the public supposes that the Government are willing to act on its behalf.
I should like to hear Ministers say a little more loudly to the newspaper-reading public, "This is a government who believe in choice. If you abhor certain journalistic practices, as you have every right to do, then abandon the newspaper which indulges in them. Vote at the newsagent! Do not look too much to government to determine what you or your children should or should not read. It is, in large degree, for you to decide. We will provide"—the Government have provided—"a Press Complaints Commission to deal with your grievances. After that, it is largely up to you".
I speak not on behalf of the press but in defence of the Government. A government who are induced to start putting ring fences around ethical behaviour can land themselves in the most tremendous pickle. I took the point made by the noble Lord, Lord Bonham-Carter, that there should be limits. It was a good story. I accept that there should be limits. The only question is how far the Government should involve themselves in setting those limits. I should be sorry to see the tremendous pickle that I forecast for a government who move too far towards the control of ethical behaviour happen to this Government. My earnest advice is—here I am not defending my profession, I am defending the Government—that the Government should keep out of it. We of the press do not offer much, but at least we offer choice. Let us tell the public bluntly that to a large degree it is up to them to choose.
4.37 p.m.
Lord Jenkins of Putney: My Lords, I find myself in the awkward position of following a group of experts. Everyone who has spoken has known what he was talking about. I am not sure that your Lordships will wish to listen to someone who is not as certain of his position in the matter as previous speakers have been; so I come to the subject with a certain amount of humility.
I speak as a consumer rather than as a participant. Although I have done a little rather contemptible spare-time journalism, I am in no way attempting to associate myself with the level of expertise to which we have just been listening. What strikes me about the press, for some organs of which I have considerable admiration, is its immense flexibility. It is that immense flexibility which is personal to journalists as well as to the press itself which makes it difficult, if not impossible, for the process of self-regulation to work.
As regards that matter I find myself in the surprising position of agreeing more with the noble Lord, Lord Wyatt of Weeford, and, to some extent, with the noble Lord, Lord Deedes, than with—I was about to call him my noble friend, because I believe he is—the noble Lord, Lord Thomson. He believes that self-regulation can and should work, if I have not wrongly interpreted him. I fear that I have reluctantly come to the conclusion that in this area it cannot work, it is not working and will not work. Therefore we must approach the question of regulation very carefully. If we do so and assume that it is not the Government but a body created by them which is responsible for regulation, if that body is careful, we could enter the field of regulation without censorship. That is extremely difficult to achieve, which is the precise problem. However, because it is difficult to achieve it does not mean that it ought not to be attempted.
In the present unsatisfactory situation with the previous examples of self-regulation, I am not as great an admirer of self-regulation as the noble Lord, Lord Thomson. I take leave to be less of an admirer of its successes and more conscious of its failures in advertising than perhaps he is. An example of the flexibility of the press is the different attitudes taken by editors when they are in the position of judge in an editorial and when they are in the position of wishing to increase the sales of the paper.
Noble Lords will forgive me for quoting an article but it is necessary for the argument. An editorial on 24th June 1990 in the Sunday Times states:
"There is no denying, of course, that the behaviour of some tabloids has made all newspapers fair game for regulation. Never have the few unwittingly done so much damage to the reputations and freedoms of the many. The worst offenders have trampled on the weak with impunity, made gross intrusions into the private lives and assassinated the characters of public figures with no excuse of public interest or anti-social behaviour, but solely the belief that it sells newspapers. Good tabloid newspapers need to be controversial … That does not mean that they have to publish sleaze, distort the truth (or, worse, print downright lies) and pander to the worst prejudices of the public. But that is exactly what some newspapers have done …
"It is unnecessarily intrusive, for example, for public figures, such as the royal family, to be subject to the never-ending scrutiny of the telephoto lens when they are
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doing no more than sunning themselves on a beach. Even the highest in the land should have the right to be left alone when they are doing no harm; press freedom should not override the right to privacy for no good reason".
That is what the Sunday Times said a couple of years ago.
In practice, a newspaper changes its view when it wishes to increase its circulation by embarking on the sins which have been so clearly described. The press man and, I am afraid, the editor can easily turn from gamekeeper to poacher and from poacher back to gamekeeper. If the editor is put on a regulation committee, he can condemn what he himself will permit in his editorial position. That is precisely the problem with self-regulation of the press.
As for the report which is the basis of this debate which has been so properly introduced by the noble Lord, Lord Bonham-Carter, it is remarkable for its absence of detail. There is not a great deal in it. The report gives us some little designs which show that the number of complaints is small compared with the circulation of newspapers. It tells us about the number of complaints by type of publication, with a design to illustrate it. However, it reaches no conclusion and gives little information about what, if anything, has been achieved.
The report includes the code of practice which the commission seeks to operate. From the code of practice at the back of the publication, one must reach the conclusion that the Press Complaints Commission has been ineffectual in implementing in any way the code of practice of which it is supposed to be in charge. The report reads more as though it is setting out aims for the future rather than what has been implemented by the Press Complaints Commission day by day.
Taking any of the items in the code of practice, one sees that they ought to be the case but unhappily they are not. For example, on the first point dealing with accuracy, the code of practice states:
"Newspapers … should take care not to publish inaccurate, misleading or distorted material".
By and large, it is true, newspapers succeed in doing that. However, one has only to read the headlines of newspapers to notice that they distort their material. It is not at all infrequent to read the headline of a column in a newspaper and then to find that the text below is directly contradictory to that headline. I could go through the code of practice, but it would take too long. I merely note that every point is laid down as an aim to be achieved rather than something which has been achieved. If that is so, then the Press Complaints Commission's report tells us that something needs to be done to bring the code of practice into actuality rather than to leave it as an ambition.
4.47 p.m.
Lord Hemingford: My Lords, I must begin with a declaration of interest. I am the secretary of the Association of British Editors. I have been a journalist for most of my working life, both in the national newspapers and latterly in local and regional papers.
I wish to say a word on behalf of the approximately 2,000 newspapers to which the noble Lord, Lord Stevens of Ludgate, referred and which do not

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normally figure in our debates. Perhaps I should also declare that I was hostile to the findings of the Calcutt Committee which subscribed to the idea that the press should be put on probation and given one last chance to avoid regulation. I took that view because it seemed to me that it put the entire press—the good and the responsible as well as the others—in hock to the maverick editor who might offer politicians the opportunity to say that self-regulation had failed.
Certain sections of the press succumbed too readily to the Calcutt formula. We should have had more debate on it before it was implemented. The code which the PCC now administers was written in secret by a small committee of editors and was only published a mere three weeks before the PCC came into existence. Understandably, the noble Lord, Lord McGregor of Durris, who is chairman of the PCC, has stressed the legitimacy of the code. He could not do otherwise, or he would have nothing to enforce.
I must concede now, after the passage of time, that the passive acceptance which the code has received from editors probably entitles it to a legitimacy which I did not think it deserved at birth. Despite what the noble Lord, Lord Jenkins of Putney, said, I believe that there is evidence that the relatively few editors about whom there has been intense concern have modified their behaviour. I am not an apologist for the Press Complaints Commission but I believe that is the case. I do not particularly welcome this debate because I believe the present situation surrounding the Press Complaints Commission is unhealthily political already and that what is needed is a reduction in the political hysteria about a few newspapers who offend but whose popularity, paradoxically, does not suggest that there is a general and widespread public concern about all newspapers. I suppose I am saying rather less well what the noble Lord, Lord Deedes, said about keeping the politics out of these matters.
Newspapers will always be controversial, and so they should be. There will always, unfortunately, be some bad journalists. I do not wish to dwell on that because others are quite happy to do so. However, one must recognise that fact. Journalism will always be likely to rank low (although possibly not as low as politicians) in the popular ratings. As has often been said in these debates, the price of a free press is some bad newspapers. However, a press which operates under a complaints commission that has been described with relish in my hearing by senior politicians as a sword of Damocles—that phrase has been used already in this debate—is not as free as it should be in an advanced democracy, if indeed we can claim to be an advanced democracy at all. That is very dangerous territory.
I attended the Commonwealth Press Union conference in Edinburgh last week and I heard it said that the British press had exercised a high degree of self-censorship during the recent general election. Whether one thinks that is a good thing or not probably depends upon the extent of one's political involvement. However, I find it worrying.
The Government, no doubt, would like to avoid introducing legislation regulating the press. I am prepared to give them credit for realising that
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statutory interference with the press is wrong in principle. However, the reality of political life, I fear, is that if the baying of Back-Benchers is considered to be dangerously loud, the Government might bow to that pressure. That is an unsatisfactory climate for the PCC and the press to work in.
There will, rightly, always be tension between politicians and the press. At present the politicians are too far in the ascendancy. I hope that this House, which can take a more measured view than those in another place—that has been demonstrated today—will contribute to trying to lower the temperature so that we avoid making bad laws on the basis of hard cases. After all, another reason for opposing a statutory Press Complaints Commission is that it would bring lawyers into the picture. With the greatest respect to the noble and learned Lords in this House, there is no evidence that lawyers would make a better job of editing newspapers than editors. Nor do I share the confidence that the noble Lord, Lord Wyatt, has expressed about their ability to draft a privacy law which would not fall foul of the point made by the noble Lord, Lord Deedes, about allowing rogues to escape.
4.54 p.m.
Lord Belhaven and Stenton: My Lords, the whole House will be grateful to the noble Lord, Lord Bonham-Carter, for introducing this subject at a time when many of the thinking British public are concerned about it. The noble Lord spoke with his usual clarity and sometimes he spoke with passion. As an ordinary reader of the press I agree with most of what he said.
I speak as a mere reader of the press and I am in no way connected with it. But having said that, I confess to a certain puzzlement when I read the report of the commission. I read the whole report although that was quite hard work. Certainly it was published before recent scandalous reports and publications had come to light. For that reason it seems to me to bear little relationship to what I believe is the public perception of what the press is up to now.
We have a limited time in which to speak in this debate and I do not have the knowledge of the press that is possessed by most noble Lords who are speaking today. Therefore I shall speak briefly. My main purpose in speaking in this debate is to ask Her Majesty's Government a question which has bothered me for a long time. I believe the question has been asked before but it has more weight at the present time than it ever has had, or possibly is ever likely to have. The question is: ought it to be possible for a foreign national to own a large portion of the British press and media? We have had some pretty unpleasant press barons in the past but at least until fairly recently there was not one who would have been unable to take the Oath or Affirmation which every Member of your Lordships' House and the other place have taken recently.
I do not think there are many countries that would allow the Murdoch press, or its equivalent, to own such a large segment of their media. A person who does not live here and who owes no allegiance to the

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Queen or to the country ought in my view not to have the kind of influence which a press baron can, of necessity, exercise. As far as I can see, that influence and power far exceeds that of any Back-Bench Member of another place and of most Members of your Lordships' House—certainly in the latters' capacity as Members of this House.
A foreign press baron has no stake in this country other than the money he can make out of it and owes no obligations to its institutions. Neither he nor his sons can be called up if there is a war and he suffers no loss, other than possibly financial, if this country is conquered or overrun by a hostile power. The state of the nation has no effect upon his or his family's future because they hold another allegiance. If he wishes to undermine the regime he can do so with perfect freedom of conscience as far as he personally is concerned. He will not be affected one way or another by any repercussions caused by his trying to impose his views.
Does my noble friend agree that Her Majesty's Ministers have a duty to protect the sovereign and the succession? Does he consider that that duty is being performed while the Murdoch press is being allowed to make an unprecedented attack on our constitution and, I would go so far as to say, on the security of the realm?
4.58 p.m.
The Earl of Longford: My Lords, I rise to offer firm support to the initiative of the noble Lord, Lord Bonham-Carter, and to offer my sincere congratulations to the noble Lord, Lord McGregor of Durris, on what he published on behalf of the Press Complaints Commission about the maltreatment of the royal family.
Things have moved on a little since I opened a debate on the tabloids in this House five years ago. At that time I said the tabloid press had deteriorated, was deteriorating and would continue to deteriorate. My noble friend Lord Mishcon was kind enough not necessarily to agree with every word I said but to say some generous words about me. Those words stick in my mind, as generous words always stick in my mind.
At any rate, I remember that debate well. I remember that the noble Lord, Lord McGregor, whom I have just applauded for his fine announcement on behalf of the Press Complaints Commission, made an interesting speech in the debate five years ago. He said:
"I hope that the Government will feel able in relation to the Press Council … quietly to twist the arms of the proprietors".—[Official Report, 18/2/87; col. 1183.]
That was as far as the noble Lord went five years ago. I am glad to say that now, as chairman of the Press Complaints Commission, he is a great deal more outspoken. He now says on behalf of the commission:
"The most recent intrusive and speculative treatment by sections of the Press (and, indeed, by broadcasters) of the marriage of the Prince and Princess of Wales is an odious exhibition of journalists dabbling their fingers in the stuff of other people's souls".
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Therefore, the noble Lord, Lord MacGregor, has advanced a good deal in those five years. I suppose that one must correlate that with a still further deterioration of the press in the five years in question.
I am glad to think that the Government have also progressed in their recognition of the dangers. Winding up that debate five years ago the much esteemed noble Baroness, Lady Trumpington, said:
"We have no intention to introduce statutory oversight of the press and we do not believe that present circumstances can justify our changing this policy".—[Official Report, 18/2/87; col. 1196.]
That may be for all time, perhaps. Now the Government are adopting a different tone towards the possible control of the press, I am glad to think. I am pleased that the Leader of the House of Commons recently came out very strongly in support of the statement by the noble Lord, Lord MacGregor, on behalf of the Press Complaints Commission. He said that,
"there will be very widespread support in all parts of the House for the comments made by the Press Complaints Commission yesterday".—[Official Report, Commons, 9/6/ 92; col. 144.]
Therefore, the Government have come out very firmly and denounced the recent treatment by the press.
I am sorry to have interrupted earlier. The trouble with these short debates is that one has only a few minutes and it is bad form to interrupt. However, it is a pity if that convention is absolute, and I could not help asking the noble Lord, Lord Stevens, whether he justified the serialisation of the Morton book. I gather that he did, but perhaps I took him unawares and tomorrow he may think of a better answer.
That is where we are now—the Press Complaints Commission denouncing the behaviour of the press recently and the Government supporting the commission. I hope that I can say that that is the general view of the leaders of other parties.
In relation to the Morton book, the noble Lord who spoke last was very severe on Mr. Murdoch. I should not have thought that it was possible to be too severe on Mr. Murdoch; however, I thought that the noble Lord was. I would not have gone as far, although I have criticised Mr. Murdoch. I did so in the previous debate five years ago, perhaps more gently than the noble Lord felt able to criticise him this afternoon.
Perhaps I may say one thing in favour of Mr. Murdoch. He owns many newspapers, including The Times. Recently The Times published a review of the Morton book by a lady who is, to say the least, not unknown to me. She referred to the book in the words of Bismarck, translated into English as "stinking more than somewhat". That seems to be an apposite comment. However, it was printed in a paper owned by Mr. Murdoch, and I must point out that in order to be fair to Mr. Murdoch, who has received bad treatment today, although defended resolutely by the noble Lord, Lord Wyatt.
If one can stink more than somewhat then I believe that the Sunday Times qualifies. It is one thing to publish an awful book—and I have written a few in my time—and one would not blame everybody for what they write in books, but the Sunday Times is a so-called quality paper and my noble friend Lord

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Jenkins very appositely described the attitude of the Sunday Times towards the tabloid press only two years ago. That paper has sunk to the depths. We can join in the condemnation.
What can we do about the problem? It is a difficult question. It has been suggested that there might be a privacy law. I cannot imagine voting against a privacy law but I do not believe that it would do much good because of the ambiguities involved, which were contained even in the support of such a law by the noble Lord, Lord Wyatt.
I put forward one thought in that context which is not usually considered. When someone is dead we expect a biography to go into his or her private life. A biography which did not refer to Gladstone's interest in salvaging prostitutes or did not deal with Disraeli's sex life would be thought a very inadequate affair. Where does one draw the line? Does one say that while the man is alive everything has to be hushed up but as soon as he is dead any self-respecting author may blow the gaff? The issue raises very difficult questions. I do not believe that we shall ever see an effective law on privacy.
What is left? The noble Lord, Lord Wyatt, made one point which interested me greatly. He pointed out that the majority of the members of the Press Complaints Commission are representatives of the press or the media. We have to think about that for a moment. Without going as far as statutory controls, which involves many difficulties, one could envisage a Press Complaints Commission which was an advisory body but on which there was not a majority of representatives of the press. I believe that that possibility is worth exploring. Presumably such a body would include considerable press representation, but it would he in a stronger position and more likely to offer candid criticism than the present body.
Until that happens we are left with the present situation. There has been horrifying misbehaviour by the newspapers in many cases. I have admired the Sunday Times for many years and I regarded it as a quality paper. However, in my view it has gone down the drain. If I thought that withdrawing my subscription would make any difference I would do so, but as the paper has increased its circulation by 250,000 copies as a result of those enormities I do not suppose that it would be noticed. I believe that the newspaper is a disgrace to journalism and to the quality press.
In the end it is up to all of us. In the last resort that means the Press Complaints Commission and, among politicians, first of all the Government. Perhaps I may for a change congratulate the noble Viscount, Lord Astor, and draw his attention to the fact that I applaud wholeheartedly the attitude which the Leader of the House of Commons has taken in supporting the Press Complaints Commission in its condemnation of the disgusting behaviour by so many elements of the press.
5.7 p.m.
Lord Colnbrook: My Lords, my reason for taking part in the debate is that I am a member of the Press Complaints Commission. I must declare that at once.
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It is our report which your Lordships have been discussing this past hour or so. I thought that it might be helpful to refer to one or two matters which have come up in the course of our discussion because I have direct personal knowledge of how the Press Complaints Commission works under the expert and very agreeable guidance of the noble Lord, Lord McGregor of Durris, whom I may now call my noble friend even though he sits on the opposite side of the House.
Everyone knows the origin of the commission, in the Calcutt Committee, and how the commission has been set up by the press itself. It has nothing whatever to do with the Government. It is initiated, appointed and financed by the press. Despite what the noble Lord, Lord Wyatt of Weeford, said a moment ago, I believe that the balance of the Press Complaints Commission is about right. There are seven editors and eight people who are not editors.
Lord Wyatt of Weeford: My Lords, they are all connected with the press.
Lord Colnbrook: My Lords, of course they are connected with the press; but should knowing something about the subject be a bar to serving on such a body? That does not seem to me to make sense at all. The people who have responsibility for what appears in the newspapers, which is what the Press Complaints Commission exists to consider, are the editors. Other people may have a financial interest in newspapers; they may have been editors or they may have been connected with other sections of the media. The noble Lord, Lord Wyatt of Weeford, mentioned one member—Sir Richard Francis—who, until he unfortunately died last week, was connected with the BBC. I cannot see that that could conceivably be thought to be a bar to being a lay member of the Press Complaints Commission. Having seen the work of such members, I consider it an advantage. Does the noble Lord wish to intervene?
Lord Wyatt of Weeford: My Lords, I do not quite understand why the noble Lord was trying to make out that the Press Complaints Commission is not dominated by a majority of people connected with the press. The balance of the nine members is made up by people who, if they are not editors, are directors of newspapers and have some editorial say in them.
Lord Colnbrook: My Lords, the noble Lord knows more than I about the responsibilities of editors. I am open to correction, if I am wrong; but it was my understanding that the editor's decision is final. However, we shall leave that point aside. That is the situation, and I shall return to the issue of how we work in a moment, because it is important.
The noble Lord, Lord Thomson of Monifieth, quite rightly said that it was necessary for the code of practice to be agreed. It is. It was drawn up by the press and not by the commission. The commission had no hand in drawing it up. It was done by a group of editors of newspapers and has been publicly subscribed to by the editor of every newspaper in the country. They have agreed to abide by it. That is its strength. The noble Lord, Lord Ardwick, mentioned

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that very point. It matters that it is the press's own code and all members of the press have subscribed to it.
That is not to say that the code cannot be altered. A moment ago the noble Lord, Lord Hemingford, said that he did not think that the code of practice was very good. I expect that it could be altered. The Press Complaints Commission cannot alter it but we can recommend alterations to those who drew it up. We have already done so on two occasions and it has been altered twice. If any Member of your Lordships' House has suggestions to make for altering it, we shall be only too glad to consider them and put them forward if they are right. The basis of the code of practice is that it is the press's own code and the press subscribe to it.
Noble Lords who have read the annual report will have seen that more than anything else when the commission receives a complaint it seeks to get it resolved amicably. Therefore we try to bring together the complainant and the editor to see whether they can resolve the problem in some way that is satisfactory to both parties. That seems to me to be far and away the best way of dealing with complaints, if it can be done.
Perhaps the extent of the commission's success or otherwise can be seen in the annual report. That indicates that four times as many complaints were resolved directly as had to be adjudicated on by the commission sitting as a whole. It cannot be bad that complaints should be amicably resolved. If they have to be adjudicated on, then that is done. Incidentally, the noble Lord, Lord Jenkins of Putney, said that the annual report did not give enough information about the operations of the commission. From what he said it seems that he does not receive the monthly report. I am sorry and shall arrange for it to be sent to him. He will see that the report, which every month we send to as many people as we believe want it, goes into very considerable detail about what the commission does. I shall arrange that from now on the noble Lord will receive it. I hope that it will not be necessary for him to make that complaint again.
I return to the question of method and the press and the lay members. What has impressed and delighted me when we consider complaints upon which we have to adjudicate is the total lack of difference between the editors and the laymen. In my ignorance I had assumed that there would be occasions —perhaps a number of occasions—when the lay members would take one point of view and the editors would take another. I have sat on the commission for 18 months now and that situation has yet to arise. If a complaint is made against a newspaper whose editor sits on the commission, that editor withdraws and takes no part in the matter. In fact, I find it encouraging that there has been no difference between us at all in the whole of the 18 months that I have been there.
I shall not go into the report. Noble Lords have read it and may make what they like of it. Of interest to everybody is, as has been said already, what the
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future holds. What happens now that the 18 months' probationary period is up, theoretically at any rate? I can see only three ways forward.
One way is that there should be legislation, as was envisaged by Calcutt. Certainly the noble Lords, Lord Wyatt of Weeford and Lord Jenkins of Putney, think that there ought to be legislation. My impression from listening to the debate was that nobody else thought so. On the whole, it was not thought to be a good idea.
My noble friend Lord Deedes advanced the very compelling argument that the remedy is the hands of the public themselves and if they do not like what they read they should not buy the publication. Perhaps the noble Lord will have a word with the noble Earl, Lord Longford, who has apparently still not withdrawn his subscription from the Sunday Times. Incidentally, I have done so. I do not know whether that ideal solution will make the press behave in the way that the public want it to behave. I hope that your Lordships will excuse me if I express a modicum of doubt about whether that will happen.
The third way is to continue as we are; in other words, to have a complaints commission which, admittedly, has no power. The only power that it possesses is to require the newspapers to print adverse reports about themselves. Somebody mentioned earlier that the News of the World, having criticised a Member of the other place and been adversely commented upon by the Press Complaints Commission, had shrugged the matter off. The News of the World devoted an entire page of their newspaper the following Sunday to printing the commission's adverse comment word for word. I do not think that that newspaper has done it again yet.
As I said, the commission has no major power. The success or otherwise of the system at present in operation depends entirely on the press. I like to think that the press is taking some notice of the commission and maybe what it is trying to do will work. However, I fully realise, as we all do, that that is not for the commission to judge but for the Government, your Lordships and Members of another place. Until they judge otherwise, the commission will go on doing the best it can.
5.16 p.m.
Lord Elton: My Lords, your Lordships have been so economical with time that an interval is available. I hope that I shall be allowed to fill three minutes of it by addressing one narrow point rather than the many points that I should have liked to make had I thought that I would be here at the end of the debate. I want to address an assumption which has been made by most speakers and which I believe is not sound; namely, that it is not proper or possible to legislate for the protection of privacy because freedom of speech is generally good and it is generally good that it should not be curtailed.
My noble friend Lord Deedes provoked my return from the far door when I was behind the Woolsack and induced me to come into the Chamber. He most plainly made the assumption that it was right that justice—if that is what it is to be—should be achieved not by legislation but by the effect of market forces;

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that is to say, the public behaving unlike the noble Earl, Lord Longford. I do not consider that that is a correct assumption. In fact our time is spent in legislating for the control of things which of themselves are good and which people can use harmfully. We legislate against what people want in the way of speed in built-up areas, which is harmful to other people. We legislate against the use of otherwise beneficial drugs because they are harmful to the user. There seems to be no argument in philosophy why one should not legislate for the protection of private individuals whose lives may be destroyed by the intrusion of the media.
I do not want to speak with undue heat at this time because there are particular cases before the public eye. However, I beg your Lordships to remember that one does not need to be a national figure in order to he devastated and have one's family devastated by publication of facts which are properly one's own property and nobody else's and which in many instances may not be true. We all know that truth lives at the bottom of a well and emerges only with her nakedness clothed with newsprint. But that is a generalisation which journalists would not like me to use.
I merely say that on my last recent visit abroad, I went to Singapore, which is not far from the Straits of Malacca. On the front page of the Sunday Times I read a story telling me that the British Government were about to make a proclamation against piracy on the high seas and send units of the Royal Navy to control piracy in the Straits of Malacca. I established with the Foreign Office that there was no truth in that story. However, a good deal of umbrage was being taken at the other end of my trip when I arrived. I refer to that in parenthesis. It is not relevant to privacy; it is relevant to the fact that what is printed may not be true and may therefore be doubly harmful and lead to people being judged on statements about them which are false.
If there can be regulation in France—and I was unaware that there was—we should consider such provision in England, Scotland, Wales and Northern Ireland. I hope that this is not the last occasion on which we shall address the subject before it is put to bed by a decision by Her Majesty's Government. That is my reason for intervening. I hope that the Government will not be precipitate in coming to a conclusion on a subject about which many people feel more exercised than many of the speakers in this debate.
5.20 p.m.
Lord Harris of Greenwich: My Lords, over 25 years ago, the House of Commons debated a Motion calling for the appointment of a Royal Commission on the press. That Royal Commission recommended the creation of a press council, the forerunner of the present Press Complaints Commission whose report we debate today.
Anyone who reads the report of that debate in Hansard will be struck by two features. The first demonstrates that the anxieties then expressed were very similar to those which have been touched on in
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the debate today; that is, the concentration of ownership of the media. The other feature is that hardly a word was spoken about the issue on which the noble Lord, Lord Elton, has touched; namely, the intrusion into people's privacy by newspapers.
In 1946 the debate primarily related to an issue which was seen by the then government Benches as the unacceptable conduct and power of a handful of newspaper proprietors, primarily the late Lord Beaverbrook and Lord Kemsley. Yet it was significant that many who supported the Motion that there should be a Royal Commission conceded that the political sympathies of the national press at that time did not represent an intolerably unfair weighting in favour of the Conservative Party. Indeed, some rather friendly things were said about the press. In the report in Hansard on 29th October 1946 at col. 549, Mr. Morrison, speaking as Leader of the House of Commons, said:
"I do not under-estimate the fact that the popular press of today is a press of, on the whole, a better standard, catering for a better degree of education, than the same popular press did 20 or 25 years ago".
I wonder whether anyone in this House would make such a statement today.
There has unfortunately been a substantial deterioration in the quality of the tabloid press in the past few years. We have seen in a number of tabloid newspapers gross intrusions into personal privacy, payment to criminals and the associates of criminals, and other serious malpractices. During the recent general election campaign—I do not refer exclusively to the Conservative tabloid press—even less of a serious effort was made to give an honest account of the activities of politicians whom they did not favour.
Like my noble friend Lord Bonham-Carter, I have found it richly comic to hear the protestations of some of the editors involved denying that in the last election their activities had any discernible effect on the result today. Indeed, we heard an echo of that from the noble Lord, Lord Stevens of Ludgate. Perhaps I may touch on what was said to the Royal Commission by a rather more candid witness, the late Lord Beaverbrook. When he was asked about his position on the matter he stated:
"I ran the paper for propaganda and with no other purpose".
Then, slightly less plausibly, he added:
"The policy is that there shall be no propaganda in the news. There is a strong stern rule and the most tremendous attempt is made to carry that rule into effect. But we do stumble. It is terrible how we stumble. It is heartbreaking sometimes".
I am sure that that was a deeply sincere statement.
He said that the Beaverbrook Newspapers were united in support of the Empire. The late Lord Beaverbrook said that if editors diverged from that, "I talked them out of it". I do not believe that Mr. Murdoch has to spend an immense amount of time explaining his views to his editors or talking them out of any position that they hold which is not his own. I do not believe that Mr. Murdoch—unlike the late Lord Beaverbrook—has any clear view of the world that he would like to see. He sees his newspapers, perfectly understandably, as a source of financial power.

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He has been highly successful in commercial terms. The Sun —to take the most obvious example—was an abject failure under its previous ownership. Under Mr. Murdoch it has been a notable commercial success. But of course the price has been immensely high. He has created a vulgar and brutish newspaper and in so doing has driven the remainder of the tabloid press still further down market. At one level its loud-mouthed xenophobia is more a cause of amusement than irritation until one remembers those sad young men in Malmo and Stockholm wrapping themselves, sometimes almost literally, in the Union Jack, and winning for this country the reputation of possessing some of the nastiest soccer hooligans in Europe.
However, in a free society we have to put up with the Sun and its stablemates. But we have the right to demand that they observe the standards they set for themselves in the code of practice of the Press Complaints Commission. The noble Lord, Lord Colnbrook, reminded us that the editors were consulted about the matter and both editors and proprietors, including Mr. Murdoch, committed themselves to accepting the code.
In my view the publication by one of Mr. Murdoch's newspapers of the serial rights of a book concerning the Prince and Princess of Wales was entirely unacceptable. In my judgment it was a violation of the section of the code of practice relating to personal privacy. No doubt in commercial terms Mr. Murdoch is a happy man. One of his newspapers sold a further quarter of a million copies as a result and it cost it only £250,000 to buy the serial rights. Mr. Murdoch operates in a free society. He is entitled to behave in any way that he considers appropriate. But we have to bear in mind, as the noble Lord, Lord Belhaven and Stenton, reminded us, that Mr. Murdoch, formerly an Australian citizen, is now a citizen of the United States. In that context, it seems a little odd that we as a country have given Mr. Murdoch—who in my view has debased journalistic standards—almost everything that he asked for. As my noble friend Lord Bonham-Carter pointed out, that is what we did during our debates on the Broadcasting Bill. With the general election now out of the way, he clearly believes that there is even less likelihood that Ministers will do anything to obstruct him.
His newspapers have demonstrated an almost unique reputation for bullying any politician who gets in their way. The noble Lord, Lord Wyatt of Weeford, and my noble friend, Lord Thomson of Monifieth, referred to one case. Ms. Clare Short, a Labour Member of Parliament, introduced a Bill concerning the publication of photographs of page 3 girls—an indispensable feature of every edition of the Sun newspaper. The Sun and its stablemate the News of the World then ran a campaign directed against Ms. Short. For instance, the News of the World published a story about an advertisement in Tribune. It was headed "Anti-porn MP's ex-aide quizzed over porn". The Press Complaints Commission, in the first of its monthly judgments, stated that Ms. Short's name had
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been dragged in irrelevantly and unwarrantedly largely on the basis that she was a reader of Tribune. It stated that that story—and a second story to which I shall refer in one moment—raised an inescapable suspicion that the newspapers were pursuing their private interests against Ms. Short to embarrass her in retaliation for her campaign against them.
The second News of the World story related to a man with whom Ms. Short had a friendship in the early 1970s. During the course of the newspaper's investigations it interviewed Ms. Short's former husband and attempted to obtain from him photographs of her in a nightdress. The Press Complaints Commission stated that the News of the World's dealings with Ms. Short's former husband were indefensible. I am sure that that judgment will be shared by everyone who has read the report.
That is only one example of the treatment accorded by Mr. Murdoch's newspapers to anyone who gets in their way. Yet this is the media organisation which, as regards those issues and others whose guidelines we are debating today, clearly believes that Ministers will at worst give it a light tap on the wrist. It does not believe that its immense power is under the slightest threat from the Government. The reasons for that are self-evident and were mentioned by the noble Lord, Lord Deedes.
I find the prospect of a statutory Press Commission with members appointed by Ministers a deeply objectionable idea. In spite of its advocacy by the noble Lord, Lord Wyatt of Weeford, I am also not attracted to a Bill dealing with a general right of privacy. That would be an immensely more complicated issue than he suggested in his speech. For reasons that I set out in considerable detail during our debate on the subject in April 1989 I do not like the idea. But I find it extremely difficult to believe that we should passively accept still further power being transferred to Mr. Murdoch's media empire. Its tentacles already extend far too wide. It is time that that power was diminished.
5.32 p.m.
Baroness Birk: My Lords, I speak as a former journalist on a national newspaper, as the originator of Nova magazine and as one who considers herself to be a friend of the press in the present and who is against legislation in the future. However, as has been made clear by all noble Lords who have spoken today, the press is trying the patience of its good friends.
I do not wish to dwell on the furore caused by the publication in the Sunday Times of "that" book, which has been exhaustively covered. Any further comment can only increase the sales of the book or the demand for the Sunday Times. However, I must say that it would have been less hypocritical if those responsible for publishing the excerpts had spent less time on arguing the case of the constitutional importance and that old, all-purpose standby "public interest", because publication was a godsend for drooping midsummer circulation. In that, I agree with my noble friend Lord Thomson of Monifieth.
The noble Lord, Lord McGregor, in his foreword to the first annual report of the Press Complaints

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Commission, points to the astonishingly small number of complaints made against newspapers in general—fewer than 1,400—and popular national dailies and Sundays in particular. The noble Lord, Lord Colnbrook, as a member of the commission was helpful in explaining some of its work. Is the smaller number of complaints than expected due to the fact that all are reformed characters or that people now accept what would have been unprintable even a decade ago? I believe that there has been a greater liberation—some may call it licence—in society and in the press. The two are interlinked. My noble friend Lord Ardwick will know, too, that under Sir Hugh Cudlipp the Daily Mirror was lively and entertaining but that it had a serious streak which made it practically compulsive reading for all Members of Parliament. That shows what can be done with genius such as his and a different ownership.
The Press Complaints Commission claims evidence of its own success. By means of an advertising campaign and the circulation of publicity material to organisations such as the citizens advice bureaux it intends to take steps to inform people how it works and can be used. Those are encouraging features. It will be interesting to see whether there is a great flow of complaints or whether when people can take a structured action they do nothing except perhaps tell friends. I believe that the latter may be the case unless the incident is gross and has a personal effect.
I accept that the commission had some success during its first year of operation. Unfortunately, that has been tempered by the excesses which have occurred since publication of its report. The tabloids alone must not take the blame for what are considered to be the faults of today's press. Self-described quality papers may not originate stories more shocking than those in the popular papers but they reproduce them, often with some pictures and with an air more of sorrow than delight. I am reminded of the famous Fleet Street editor of a Sunday newspaper who in the 1940s obtained pictures from an Italian agency. They showed a member of the Royal Family in a particularly revealing swimsuit. In those days the Royal Family was not the fair game that it is today. But at last he had an inspiration which enabled him to use the pictures. "Shocking Pictures", or similar words, was his headline. Underneath he wrote: "It is our duty to reveal these disgraceful pictures of our princess, which foreigners are gloating over". He then blamed the "evil cameramen". The upmarket papers feed from the tabloids, as sucker fish feed from a whale, and then publish readers' letters deploring what is happening at the other end of the market.
I do not like to put myself in the position of sounding priggish or prudish about the press, whether quality or tabloid. However, the change not only in the tabloids but in the self-described quality papers is a culture shock. That is not to excuse for one moment the harassment and intrusion into privacy, which in general is perpetrated by the tabloids, as the Press Complaints Commission's case histories illustrate. That point has been made by most, if not all, noble
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Lords today. Some of those case histories are horrendous and there is no point in pretending otherwise.
We then come to the question of whether to legislate or not. Most of your Lordships' contributions—except that of the noble Lord, Lord Wyatt—put the case both for and against doing so.
My view is that taken by the noble Lords, Lord Bonham-Carter, who has given us the opportunity to discuss these matters, Lord Thomson of Monifieth, and Lord Harris of Greenwich. It is a seductive idea to have legislation restricted to dealing only with invasion of privacy. That would deal with one of the worst features of the press today. However, as has been pointed out by various noble Lords, it is an almost impossible task. I do not believe that legislation is the answer because there is the grave possibility that it will not achieve the desired aim. To draft such legislation would be extremely difficult. Personally, I do not believe that it would work.
Also, it would have an adverse effect on the freedom of the press. It is extremely interesting to glance back 200 or 300 years to see some of the stirring articles that were written about the importance of press freedom at that time. In my view, the opinions expressed then still obtain today. If we hit the problem with a statutory hammer, we shall hit not only the freedom of the press but also the freedom of the individual. Curiously enough, it is much more essential in a democratic society to have a press which constantly scrutinises both the government and what they are doing and executive and governmental agencies. It should be free to do that without fear. I do not trust any government of whatever colour to play fair as regards this matter. A government will always give reasons to avoid playing fair, and we hear that and see that nowadays.
As the noble Lord, Lord Deedes, and others have pointed out, legislation may catch important investigative journalism as well as the foot-in-the-door excessive behaviour. It is impossible to make an unarguable distinction between news and comment, although it would be very nice if that were possible. The noble Lord, Lord Harris of Greenwich, gave us an extreme but amusing example of that when he referred to Lord Beaverbrook.
While we are dealing with and hoping for a responsible press, we must accept that we pay a certain price for that in a democracy; that is, having to tolerate some irresponsible areas of the press. That does not mean that we should not try to do something about it but I do not believe that legislation is the answer.
The Press Complaints Commission has an important role to play. I hope that role will improve and increase with time because we should remember that the commission has not had long to prove itself. However, the role is a negative one, as I am sure the commission itself accepts. We need a changed climate in which the press can play a positive role. Incidentally, that was the implicit thrust of the letter from the editor of that vigorous, sparky, local paper the Hampstead and Highgate Express in The Times yesterday.

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I believe that we badly need a freedom of information Act. We are an extremely secretive society, although we boast about our openness and freedom. However, that openness and freedom are not all they seem to be. Moreover, libel and contempt laws badly need changing. Gagging injunctions, which prevent publication without knowing whether or not material will be libellous when it is published, are a disgrace. It is time that something was done about them because that affects what is going on in the press and it affects readers' views and reactions.
Libel damages have become ludicrous. In criminal cases the jury decides on guilt but not penalty. In a libel case the jury should decide whether or not libel has been committed but the question of damages should be left to the judge.
It should be made easier and less expensive for people to take on the press. Something on the lines of a small claims court with an upper financial limit might be helpful. Often people who have quite a serious grudge against the press or have been badly treated feel that they cannot take action because they do not have the necessary funds. A small claims court, or something like it, would remedy that situation.
I shall not say much about cross-media ownership because a great deal has been said, most of which I agree with. It is unhealthy to have such enormous slices of the media in the hands of one person, as the concentration of views is associated with a concentration of interest. It is essential that there should be plurality in the media. So many noble Lords have dealt with that subject that I do not believe that I have anything more to say, other than to add my voice to warn against what is an extremely dangerous and unhealthy situation. We argued this out during the passage of the Broadcasting Act, when it was recognised that no regulations would control satellite TV, and unfortunately we were proved right.
In considering the Press Complaints Commission's first year's record, it would be wrong and dangerous if the Government allowed themselves to be pushed into legislative sanctions. I believe that financial sanctions should be considered for the commission if they are not too difficult to work out and do not involve the intervention of too many lawyers. I have toyed with that idea. However, the commission needs longer to prove itself and particularly to see whether the committee of editors under the chairmanship of the editor of the News of the World, against which a very bad case has been quoted many times, makes a real impact on standards. It is laughable in a way but it may be that we shall see that the poachers turn into the most admirable and strictest of gamekeepers.
5.48 p.m.
Viscount Astor: My Lords, we are all extremely grateful to the noble Lord, Lord Bonham-Carter, for initiating this debate on a matter of great public and constitutional importance.
The debate that we have had this afternoon has been unusually stimulating and of the highest intellectual quality. I have listened with great interest to all the contributions which have been made. Today
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we have heard from a chairman of a newspaper publishing company, my noble friend Lord Stevens of Ludgate, from three former editors of national newspapers, and from other noble Lords who have great experience in the world of journalism and broadcasting. I shall have more to say later on the particular points raised, and I shall try to respond to some of them.
Perhaps I may begin by saying that the debate has highlighted with particular vividness three points: first, the enormous importance of the subject as regards our basic rights and freedoms; secondly, the great difficulty of reaching a satisfactory accommodation in a free society between the rights of the press and those of the individual to be left in peace; and, thirdly, the very wide range of opinion which is held by your Lordships on what the Government might now do in that sensitive area.
Today is an apt day for the debate as today is the day which follows the 18-month probationary period which the Government set the press within which to prove that press self-regulation, overseen by the Press Complaints Commission, was an effective means of preventing press misbehaviour. It may help your Lordships for me briefly to recapitulate some of the history which led to that probationary period being imposed.
I quote from 1782:
"How shall I speak of thee, or thy power address
Thou god of our adolatry, the Press?
By thee, religion, liberty and laws
Exert their influence, and advance their cause;
By thee, worse plagues than Pharaoh's land befell,
Diffused, make earth the vestibule of hell".
Anxiety about the power of the press is certainly not new. The report of the third Royal Commission on the Press, under the chairmanship of the noble Lord, Lord McGregor of Durris, chairman of the Press Complaints Commission, included that quotation from the poet Cowper.
But the modern period begins with the first Royal Commission on the Press of 1947–49, which recommended the establishment of a General Council of the Press. The second commission of 1961–62 recommended that the general council should be reconstituted, while the third Royal Commission, to which I have already referred, recommended further improvements to newspaper self-regulation. The third commission reported in July 1977, almost exactly five years after the report of the Younger Committee on Privacy which the commission followed in recommending against a statutory right to privacy.
Since the Younger Committee and the McGregor Commission reported, there have been numerous allegations of declining press standards and of growing intrusion into individual privacy. The immediate background to the appointment of the Committee on Privacy and Related Matters, under the chairmanship of Sir David Calcutt, was the extent of parliamentary support during the 1988–89 Session for two Private Member's Bills in another place, one on protection of privacy and the other on the right of reply. The Government could not support those Bills for reasons of principle and because they were technically flawed; but on 21st April 1989 we

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announced the setting up of the Calcutt Committee to look at possible means of redress for journalistic intrusions into privacy and related matters.
The committee reported in June 1990. It recommended, first, the establishment of a non-statutory Press Complaints Commission to replace the old Press Council; secondly, three related criminal offences of unwarranted journalistic intrusions; thirdly, extended court reporting restrictions in criminal cases; and, fourthly, that if non-statutory press self-regulation failed to work, a statutory system for handling complaints should be introduced.
The Government accepted the general approach proposed by the committee, making it clear that the proposed Press Complaints Commission would be reviewed after 18 months' operation to see whether it should be put on a statutory footing. The newspaper industry duly established the Press Complaints Commission on 1st January 1991. As my noble friend Lord Colnbrook, a member of the committee, said, a code of practice was drawn up by the industry itself, with which the press was expected and agreed to comply.
The three related criminal offences of unwarranted intrusion remain under consideration. The proposals for extending reporting restrictions were given effect in part in a handout Bill in another place which reached the statute book on the last day of the 1991–92 Parliament. The fourth recommendation, for a statutory system of handling complaints if self-regulation failed, depends on the outcome of the review.
The probationary period of 18 months to which I referred has just expired. The task now facing the Government is to review the experience of press self-regulation, and in particular the part played by the Press Complaints Commission in enforcing compliance with the industry code of practice, over the past 18 months. We must consider whether the press has kept to its own code.
I am not in a position today to tell your Lordships precisely how the review on the 18-month period will be carried out, nor by whom, nor over what timescale, but the Government hope to be in a position to make an announcement soon. Nor am I able today to anticipate or guess the outcome of the review; indeed, it would be quite wrong of me to do so. I can however give your Lordships an assurance that the views expressed here today will be taken fully into account in the review.
Reconciling the freedoms which the press ought quite properly to have with the rights and freedoms of others is an intractable issue. The architect of the European Convention on Human Rights must certainly have thought so, for a study of the relevant provisions of the convention does not get us very much further forward. Article 10 guarantees, among other things, freedom to receive and impart information and ideas without interference from a public authority. But Article 10 quite properly says that the exercise of those freedoms, since it carries duties and responsibilities, may be subject to restrictions or penalties in order to protect, among other things, the reputation and rights of others. One
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such right is of course the right to respect for privacy in Article 8, which guarantees—again subject to qualifications—the right to respect for privacy and family life, home and correspondence.
Coming closer to home, I think we could agree with Junius that:
"The liberty of the press is the Palladium of all the civil, political and religious rights of an Englishman".
But I fear that we would also have to agree that newspapers have at times abused the power that press freedom confers, not to secure and defend rights, but to breach them. The noble Lord, Lord Thomson, reminded your Lordships of the quote in regard to the proprietors of certain newspapers, which accused them of,
"power without responsibility—the prerogative of the harlot throughout the ages".
We should perhaps treat with caution if not suspicion, editors' claims that they are merely messengers, especially when publication of a message of doubtful service to the public interest gives a great boost to circulation. The question must he posed as to whether the committee of editors is satisfied with its own code.
The dilemma we all face is that we want a lively and reliable press and a well-informed public, but not at our own expense. As the noble Lord, Lord Wyatt of Weeford, reminded us, we are readier to read about others' private affairs than to read about our own. We are often voyeurs of the troubles of others. But we should always distinguish between the public right to know and what the public delights to know.
Some of your Lordships have suggested that recent press intrusions into privacy have gone too far, and the time has come for the Government to introduce statutory controls. I do not wish to comment on specific cases, and it would be wrong of me to anticipate the outcome of the review of press self-regulation to which the Government are committed. But I should like to underline the great difficulty there will be when it comes to considering remedial action, in making decisions about precisely how far is too far. Somehow or other, those who believe that legislation is the right course will have to draw a line between what is acceptable, or at least tolerable, behaviour by the press and what is unacceptable and intolerable and adds nothing to the legitimate public interest. I thought the remarks of my noble friend Lord Deedes in that regard were most interesting.
Many of us would, I believe, accept that the private lives of public figures, especially if they have chosen or courted publicity, have somewhat different boundaries from those of people not in the public eye. We would also accept that intrusion into privacy, however undesirable in itself, can sometimes be justified, whether in the wider public interest or to protect a more pressing need of others.
Perhaps I may venture as a third proposition, the point touched on by the noble Lord, Lord Ardwick, that public perceptions of what is private and what journalistic activities are acceptable change rapidly just as society's views and values change. Linked to that, the rapid circulation of news made possible by technological advances makes it even more difficult

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than it used to be for the citizen to restrain damaging publicity. News is now flashed around the world in seconds.
I make these points to illustrate the difficulties of defining what we mean by the abuse of media power. The first difficulty is that, as the debate has clearly shown, we may not all see eye to eye on where the line between public and private should be drawn. The second is that even if we could reach such an agreement, defining that line in such a way that it covers all possible contingencies is a complex legal task. These difficulties of definition go to the heart of the reasons why the Government have been reluctant to see either an individual right to privacy or indeed any form of statutory control over the press. It is worth recalling that we have had no peacetime control of the press since Charles II. We have no press laws in this country. But proprietors, editors and journalists are subject to the general law—whether it be on defamation, prejudicing of legal proceedings, obscenity, trespass or copyright—in exactly the same way as any other citizen; they enjoy no privileges or exemptions. By and large, the freedom of the press has served us well, even if we do not always like the consequences.
The noble Lord, Lord Wyatt of Weeford, and my noble friend Lord Elton have suggested that a possible way forward is to enshrine in English law a general right to privacy together with a general public interest defence and leave the courts to develop suitable case law as in France. I understand it is the case that the law of privacy in France developed largely at the initiative of the courts in the 1950s and 1960s in response to the excesses of the press.
I am not a constitutional lawyer, but I believe that such an approach would be completely contrary to our traditions. In this country we have preferred to proscribe or remedy particular evils rather than confer general rights. The enactment of general rights would leave to the courts the precise definition of those rights and the determination of conflicts of interest arising in relation to them. No doubt in time courts could evolve a suitable jurisprudence; but in the meantime, I suggest there would be great uncertainty with no citizen quite sure what his rights and obligations under the law amounted to. That does not seem to me to be a very satisfactory approach. Surely, it is far better for Parliament to seek to define precisely in statute what is meant by rights to privacy, and such slippery concepts as the public interest.
Many of your Lordships have commented on cross-media ownership. The Broadcasting Act 1990 imposes a number of restrictions on controlling interests in both the newspapers and licensed television or radio services. The Government keep arrangements under careful review, but so far have seen nothing which would seem to justify changing them. However, I shall bring all of your Lordships' comments to the attention of the Secretary of State.
I realise that perhaps I have posed as many questions as I have answered; but I must emphasise that the Government remain extremely reluctant to intervene in the traditional freedoms enjoyed by the
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press. Any change in this long-standing policy would be of great constitutional significance. But we have heard many voices this afternoon which claim that the present arrangements do not and sometimes cannot he made to work. We shall certainly take to heart all the anxieties raised.
I appreciate that press treatment of the marriage of their Royal Highnesses the Prince and Princess of Wales has caused anger and dismay among your Lordships and the public at large; and I am sure that the recent strong condemnation of it by the Press Complaints Commission will have been widely welcomed. I am also sure that I speak for all your Lordships when I say that we hold and will continue to hold the Monarchy in the deepest affection and respect in this House. We will give very careful consideration to the views of the Press Complaints Commission and of your Lordships in the review of press self-regulation which now needs to be undertaken.
Lord Bonham-Carter: My Lords, I should like to thank all noble Lords who have taken part in the debate. I thank the noble Viscount for answering so many questions. I suppose I should also thank him for giving so few answers. I should not be disappointed that he cannot tell us when and how the review will take place, when it will report or who is undertaking it. I should not be surprised that, having looked at cross-media ownership, he sees no reason to persuade the Government to change their view that nothing need be done. I suppose that is par for the course. However, I thank him for running so true to form and beg leave to withdraw my Motion for Papers.
Motion for Papers, by leave, withdrawn.

Boundary Commissions Bill
Brought from the Commons; read a first time, and to be printed.

Privatised Utilities
6.8 p.m.
Lord Ezra Lord Ezra rose to call attention to the operations of the privatised utilities, with particular reference to the role of the regulators; and to move for Papers.
The noble Lord said: My Lords, between 1984 and 1989 the previously publicly-owned utilities of telecommunications, gas, electricity and water were privatised. Hitherto the economy had been divided into two parts: the public and private sectors. Within the public sector were comprehended those activities which were either directly or indirectly controlled by government. Within the private sector were those enterprises which were subject to the rules of competition as interpreted by various Acts of Parliament and supervised by such bodies as the Monopolies and Mergers Commission and the Office of Fair Trading. Since the privatisation of the public utilities a third sector has emerged; namely, the regulated sector. That has arisen because of the regulatory systems incorporated in the privatisation Acts of those enterprises.
Thus, a major change has taken place in the structure of the British economy. The enterprises which form part of the regulated sector are of particular importance because they meet basic needs and each of them is very large by normal commercial standards. Last year they had a combined pre-tax profit of over £5 billion. They employ over 500,000 persons. Regulation on this scale is an entirely new phenomenon in British economic experience. It is therefore not surprising that many issues have arisen which are as yet unresolved. The purpose of the debate is to examine some of those issues.
Before doing so, I think it is only fair to consider where the privatised utilities have made positive achievements. They lie particularly in the areas of service and standards. A new impetus seems to have been developed in this direction. Complaints are generally dealt with more rapidly. As regards British Telecom, there has been a noticeable reduction in the time taken over new installations. Maintenance and repair arrangements have been tightened up. Major efforts are being made concerning gas and electricity to promote energy efficiency. The Energy Savings Trust has been set up. British Gas has worked closely with Neighbourhood Energy Action—an organisation with which I am personally involved—in stimulating insulation especially in low income homes. As regards electricity, East Midlands Electricity is pursuing a policy of least-cost planning. London Electricity has launched a campaign for low energy housing.
The water companies have made an important start in dealing with the backlog of investment which has built up over many years. Service and standards are rising in consequence. For example, Severn Trent is investing at double the rate of its profits. It has kept its charges competitive with other companies and raised the water quality. Thames Water has made good progress with its regional grid. These are examples chosen at random.
Despite these positive aspects of the operations of the privatised utilities, they remain highly regulated. Why is that? One would have assumed that if they had made such progress there would be no need for regulation; but it is because an inadequate competitive framework was provided for in the privatisation legislation even in those cases where that was technically feasible. For example, many of your Lordships will recall that during the course of the debate on the Telecommunications Bill there was much pressure on the Government to extend the process of liberalisation further before privatisation. There had been a degree of liberalisation, but there was pressure to extend it. That was resisted by the Government. In the case of the Gas Bill, much anxiety was expressed about the privatisation of the industry as a single monopolistic enterprise. As regards electricity, while a degree of restructuring was incorporated in the legislation, many felt that it did not go far enough in dividing up the electricity generating sector.
Water is more of a natural monopoly than the other three, but there were nevertheless ways in which,
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during the course of debate, it was indicated that a degree of competition could have been introduced in the privatisation measures. The reason for the neglect of this competitive element seems to have been that the Government were keen to proceed with privatisation as soon as possible and major restructuring would have held up the process. Furthermore, they appeared to want to earn the maximum proceeds from flotation and these could have been diminished if the enterprises had been changed too much.
The result has been the elaborate and intensive system of regulation which now applies in all four industries. There can be no criticism of the regulators. In each case they have been faced with a difficult and uncertain task. At one and the same time they have had to ensure that the regulated enterprises have been able to operate in conditions which would enable them to run the business efficiently and to invest adequately in the future. They have had to ensure that the consumers' interests were adequately safeguarded and protected. On top of that, they have been committed to introduce competition wherever possible. Furthermore, as concerns the energy industries, they have had to promote the concept of energy efficiency. Any one of these objectives would be daunting in itself, but to have to undertake all of them has led to a complex web of regulatory decisions and injunctions.
The regulators have indeed already made progress in stimulating competition in the industries for which they are responsible. That is particularly so in the case of the gas industry where the legislation did not envisage competition within the sector itself, but only as between gas and other forms of energy. That is the response which I personally received to the speech that I made during Second Reading of the Bill. Subsequently, due to pressure from the regulator and to interventions by the Monopolies and Mergers Commission and the Office of Fair Trading, a degree of competition has been introduced into the contract market for gas. That is the market supplying the industrial and commercial sectors. The upper limit of the tariff market, which is mainly the domestic market, has been substantially reduced. There have also been moves towards greater competition in the other three industries. However, it may be doubted whether regulatory pressure alone can introduce sufficient competition into these industries. I shall return to that point a little later on.
I now turn to pricing, on which recently there has been much concern. The prices charged by the privatised utilities are based on the price formulas incorporated in the licences at the time of the legislation. These are of extreme complexity. In a speech on 11th February Professor Littlechild, the Director General of Electricity Supply, stated that,
"price controls are not easy to understand, nor is it straightforward to check whether or not a licensee is complying with them".
Those of us in this House who, at the time the legislation was being debated, tried to understand the formula for electricity prices will certainly not be surprised at that view.
The steep increase in electricity prices in April 1991 was a matter of much anxiety to consumers. In the

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event, it was unjustified because it assumed too high a level of inflation. Furthermore, there is concern about the automatic pass-through of electricity purchase costs in accordance with the pricing formula. Similar problems have arisen as regards the prices of the other utilities. In all instances the regulators have been constrained to intervene in more detail than was implied in the legislation.
Doubts have been expressed about whether the regulators can at the same time create the conditions for the efficient running of the industries for which they are responsible and safeguard consumer interests. During the debate in this House on the Competition and Service (Utilities) Bill these doubts were clearly felt. It was proposed that greater powers should be given to consumer organisations. Among the relevant consumer bodies it was considered that the Gas Consumers Council was in the best position to operate as an independent guardian of consumer interests. As regards the other sectors, the relevant bodies were much weaker. The National Consumer Council has expressed the opinion that,
"the regulators need to be under-pinned by a strong system of consumer representation which is independent of (and yet complementary to) them".
The NCC is also concerned about the level of disconnections and the special problems of low income and elderly consumers and consumers with disability. The citizens advice bureaux have similar concerns. The Consumers' Association has drawn attention to the rising number of complaints.
Those are some of the issues which have arisen during the course of the first few years of the operation of the regulated sector. There are no doubt many others which will be referred to by noble Lords participating in this debate. The underlying issue is this. In all four cases the regulators have found that in order to carry out the functions entrusted to them in the legislation they have had to intervene more extensively and in greater depth than was at first envisaged. The question is whether detailed and continuous regulation is seen as a permanent feature in these industries. If so, that in turn raises the issue of the ultimate accountability of these powerful regulators and the role of Parliament therein. That was mentioned during the debate on the Competition and Service (Utilities) Act. It was proposed that there should be a standing parliamentary committee to which the regulators should render account, but that was not accepted by the Government.
If, on the other hand, it is intended that the present degree of regulation shall be a temporary phenomenon while competition is progressively introduced into those industries where it is feasible to do so, then the question is whether this further degree of competition can be introduced without major structural change in the industries concerned. If that is the preferred route, I believe that such structural change is inevitable. Indeed, there seems to be a strong case for doing so in the gas, electricity and telecommunications industries. In all three industries a dominant market power is exercised by a limited number of enterprises. Those enterprises have retained a degree of control over the networks through which
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their products or services are supplied. There is thus, in my opinion, a case for hiving off the networks entirely and for diminishing the size of the dominant enterprises.
In view of the vital economic and social role that is played by the regulated sector, in my opinion this is a subject that merits serious and continuing discussion. I am obliged to those noble Lords who will be participating in this debate.
My Lords, I beg to move for Papers.
6.21 p.m.
Baroness Seccombe: My Lords, I thank the noble Lord, Lord Ezra, for giving the House the opportunity to debate this matter. I welcome the chance to highlight the achievements of the privatisation programme over the past 13 years and the considerable benefits that this has brought for the customers of the privatised industries.
The transfer of two-thirds of the state-owned sector of industry into private hands has been a key expression of the Conservative belief that many areas of economic activity are carried out better by private individuals and companies than by the state. Forty-six major businesses have been released from state control, bringing new standards of service, quality and efficiency for the benefit of the customer, and realising proceeds of about £42 billion for the taxpayer. I draw your Lordships' attention to the fact that the privatisation of those companies stopped the drain on the public purse, so enabling a massive increase in funding for such priorities as the National Health Service.
Privatisation has also played an important part in advancing the objective of the broader and deeper spread of wealth through the community: from around one in 20 adults holding shares in 1979, share ownership now extends to almost one in four. About two-thirds of shareholders come from outside the ranks of professionals and managers. More than 2 million employees now own shares in their own companies. I welcome the Government's commitment to make provision for the workforce to hold a stake in the soon to be privatised British Coal.
I should like to address a criticism that is often levelled at the privatised utilities. In recent days we have heard much comment about the level of profit that has been achieved by these utilities. Companies need to be profitable to achieve the improved standards that the customer and the environment rightly demand. It is true that BT makes a pre-tax profit of £97 per second, but BT is investing £77 per second—around £2·5 billion per year—in improving the network by installing fibre-optics and digital exchanges. In addition, it pays £38 per second to the Government in tax, and dividends to shareholders. Last year the 10 water companies had combined profits of about £1·5 billion, but they invested over £3 billion—part of the record 10-year £28 billion investment programme that is needed to make up for the years of inadequate funding when investment in water quality was controlled from the Treasury.
In the quest to improve services for the customer, I believe that there is no substitute for competition. One

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area of which I have some slight experience is the electricity industry. For nine years I was a member of the Midland Electricity Consultative Council. Before privatisation the old Central Electricity Generating Board was an unaccountable state monopoly. Today Britain has perhaps the most competitive electricity market in the world, and that is good news for customers. Not only is there real competition between the three largest generators—National Power, PowerGen and Nuclear Electric—but there is also competition with the Scottish electricity companies. I welcome the rapid progress that has been achieved by the independent generating companies, many of which will soon be providing an additional competitive spur to the market.
This competition is placing a significant downward pressure on prices. Figures from the Director General of Electricity Supply show that some industrial customers have achieved savings of as much as 15 per cent. as a result of competition. This year every one of the 12 regional supply companies has announced price rises for domestic users that are below the rate of inflation.
Competition is advancing in other areas also. The Minister for Energy has announced plans to reduce to one-tenth of its present level British Gas's monopoly for the supply of gas to larger users under the Competition and Service (Utilities) Act 1992. Provisions under this Act to increase competition in water supply come into force this very day, and the development of competition in the telecommunications industry continues apace. Mercury and the personal communications companies have already claimed a substantial share of certain areas of BT's operation and eight new licences to run fixed-line networks have been issued since last year's duopoly review.
In those areas where the scope for direct competition is limited or where competition will take time to develop, there is a need for effective regulation. It is important to remember that when the utilities were under state control, there was no effective regulation, and that the regulators have helped to ensure a continuous improvement in the standard and good value of service for utility customers.
I should like to pay tribute to the work of Sir Bryan Carsberg who recently finished his term as Director General of Telecommunications. As the first of the utility regulators, he led the way in what was a new field when Oftel was set up in 1984. It is a mark of his achievement in encouraging greater efficiency that his proposal for a new BT price formula of RPI minus 7·5 per cent. will mean that the cost of a range of BT services will have fallen by 40 per cent. in the 10 years following privatisation. I wish him every success in his new role as Director General of Fair Trading.
Twelve months ago, the Citizen's Charter announced measures to improve the quality of public services; to increase the choice available to citizens; to improve the value for money offered by the public services; and to ensure that everyone knows what standards of service to expect and what to do if
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something goes wrong. Under the Competition and Service (Utilities) Act 1992, these principles are already at work in the utilities.
I shall take the example of the electricity industry once again. OFFER has introduced 10 guaranteed standards of performance which the electricity supply companies must meet. The supply companies have to make payments to customers of between £10 and £50 for failure to meet the standards, including restoration of supply within 24 hours of a fault and turning up for appointments. Acting on its own initiative, East Midlands Electricity has introduced appointment times rather than just morning or afternoon appointments. What is more, it will pay compensation if those appointments are not kept. London Electricity has announced that it will move to appointments guaranteed within a two-hour time band. I look forward to other companies following these excellent examples, thereby bringing to an end the need to he at home all day waiting for the engineer, which was so much a symbol of the low priority given to customer services by the utilities when they were nationalised.
I remind the House that we have come a long way from the days when more than a quarter of a million homes had to wait for more than two months for a telephone line; when more than one in four telephone boxes did not work; and when domestic electricity prices went up by 2 per cent. every six weeks. Therefore the huge advances that have been achieved would not have been possible without privatisation and effective regulation. The regulators now have extensive powers to make sure that the improvements continue. The often quite public disputes with the companies in their charge are proof that they are prepared to use their powers. They are not complacent about the need to keep up the pressure for improvements, and nor should we be but neither should we fall into the trap of over-regulation and thereby kill off the incentive to improve that continues to benefit customers every time they deal with a privatised utility.
I believe that the regulators are serving us well, with the whole community benefiting as quality of service improves with higher standards, more choice and better value for money.
6.31 p.m.
Lord Hampton: My Lords, I too am very grateful to my noble friend Lord Ezra for putting down this Motion about the privatised utilities and the role of the regulators.
I was brought up firmly to believe in the advantages of competition and to distrust monopolies, which can bring excessive power—and power, as we are reminded, corrupts. But in certain cases monopoly may seem inevitable. I was advised that in that case a state monopoly was better than a private one. So I am somewhat ill at ease with the privatised utilities, and particularly with the water industry, because whereas there is often some choice as to whether one uses gas or electricity, no one can do without water. Its use is inevitable. Although this can be limited to some extent, it is impossible totally to do without it. However, I do not believe—and nor does my party

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—in renationalisation with any swing of the political pendulum. We want, as my noble friend Lord Ezra mentioned, to encourage competition wherever possible.
I should perhaps declare an interest. I have a very modest investment in a personal equity plan or PEP. My stockbroker persuaded me to do this and then informed me that he would have full managerial powers. He immediately went off and bought, as I would never have suggested, shares in both gas and water. However, as those holdings are very small and as my speech will be in defence of the consumer rather than the shareholder, I speak with an easy conscience. So let me come quickly to the point on which I ask clarification. I shall be dealing mainly with the water companies, but I believe this to be relevant to the other utilities also.
On 11th March this year we discussed water pollution and shortages in a debate opened once again from these Benches, on that occasion by my noble friend Lady Robson. I ended my speech with this question:
"what incentive do the privatised water companies have, even with Ofwat on their backs, to encourage sensible economies in the use of water and to educate the public in possible methods of so doing?" [Official Report, 11/3/92; col. 1383.]
The noble Baroness, Lady Blatch, replying for the Government, said:
"In assessing the K factor, pass through costs are allowed for. We must link in the minds of people the cost of those improvements. That must be part of the downward pressure on bringing that message to bear".—[Official Report, 11/3/92, col. 1402.]
I wrote to the noble Baroness on 17th May, saying:
"I did not understand your answer then and I do not understand it now. I would be most grateful for clarification".
Unfortunately, she seems never to have received that letter so I am still in the dark. I do not in any way blame her. I believe that she was under almost intolerable pressure, dealing, as she was then, with both environmental and educational matters. But my submission is that, in saying what she did in her reply, she was not very well advised. I have given the noble Baroness, Lady Denton, notice that I would ask her the same question and I shall be most grateful to hear the reply.
Quite frankly, when K factors were mentioned during that previous debate I had no idea what was being talked about. I asked a number of friends later and was relieved that they did not know either. So I turned to the rather impressive modern dictionary I have. This did not give me the answer I wanted but told me that the letter K stands for many things; among those are a kilo, a king at chess and the symbol—heaven knows why—for the element potassium. But its most intriguing meaning is apparently:
"The llth in a series: 10th when J is omitted".
Bemused, I found myself wondering whether the noble Baroness had included J or not!
But, to be serious again, I now have to hand an information sheet from Ofwat entitled The K factor—What it is and how it can be changed. I am rather better informed. I hope noble Lords will bear with me if I quote from the first two paragraphs of the information sheet. It states:
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"The formula which limits the charges water companies can make for their services is laid down in the licence under which each company operates. The formula is the Retail Prices Index (RPI) plus K".
The information sheet goes on:
"K is a charging limit. It represents the amount by which average charges can rise in any one year".
Now I have to admit that I still do not see what control in the increase in charges really has to do with encouragement of the public to use less water and their education as to why it is desirable, and how to achieve this. I am also uncertain what powers, if any, the regulator has in this field and whether they are sufficient. Will the Citizen's Charter have any influence on the running of privatised utilities?
Some people still seem to refuse to face facts and believe that the present water supply is somewhat short only because in recent years there have been droughts and that with a return to usual rainfall the problem will go away. But the Council for the Protection of Rural England—CPRE—believes that we really are approaching a crisis and that it is time to stop abusing our amazing good fortune—I paraphrase those words from memory—in having what is by world standards a plentiful, but still not a limitless, supply of water.
Nearer home, the noble Lord, Lord Nugent of Guildford, was not long ago arguing the need to build a number of large reservoirs. He is an expert on water matters, and I certainly am not, but I still wonder whether he is right. Unfortunately, he is not with us here these days.
Another suggestion to relieve a shortage of water in the South is a massive diversion of water from the North. But here again it could be a very costly process —and arguably damaging to the environment—and who is to pay? Obviously, it would be the consumer. The citizens advice bureaux are, as my noble friend Lord Ezra has already mentioned, pointing to a good deal of hardship caused through water supplies to houses being cut off where people cannot pay and then only reconnected at high cost.
I was also concerned by a letter in The Times of 27th June from Mr. Derek Braggins, which claimed it was wrong that South West Water should have been granted a renewal, by temporary licence,
"to enable them to continue abstracting water from the River Axe with a reduced flow, in effect enabling them to continue taking water from the river under summer drought conditions".
He concluded:
"Last week, despite strong public objections and another dry summer with extremely low water levels, the NRA Southwest region approved the licence".
I do not know the background to this controversy, but it further emphasises, if emphasis is needed, that we really do have a water shortage problem that must be tackled. As I understand it, there are no plans at present to introduce compulsory general water metering, but I was interested to see a television programme which said that water metering was widespread in West Germany, which has no problems with supply. It also showed a young, newly wed German couple—your Lordships may have seen the programme—asking advice in the shops as to which

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equipment used least water. That seemed a highly desirable result. I was also interested to read in a news release by Ofwat of 12th May this year:
"All customers have a right to ask for a meter. Many pensioners and those living alone would be amongst the large number of customers to gain from having a meter. Metered customers can control what they spend, rather than paying for high consumption by others".
Then came some rather sinister words:
"Too often they are deterred by unreasonable installation charges, by inflexible company procedures and by unfavourable tariffs".
If that is true, something is wrong.
The darkest, but still possible, scenario that I foresee is: first, no steps are taken to encourage economy in the use of water. A "remedy"—I put the word firmly in inverted commas—is sought in building some more enormous reservoirs as well as putting in hand an extremely expensive operation to divert water from the North to the South; next, it is found that further steps are necessary to check consumption, and water metering becomes widespread; next, the whole operation has turned out to be extremely expensive and charging now has to be much higher; and, finally, large and poor families are very hard hit by what they have to pay and have to practise painful economies. I hope that I am wrong, but I foresee difficulties ahead. We must keep a careful check on what is happening through the regulators and through Parliament.
6.42 p.m.
Lord Skelmersdale: My Lords, while listening to the noble Lord, Lord Ezra, I remembered the great 18th century French philosopher Voltaire. The noble Lord is looking puzzled, and I am not surprised. He may well ask what on earth that has to do with his timely and important Motion. The answer is quite a lot. One of Voltaire's letters contains the thought that if God did not exist, it would be necessary to invent him. That leads me to wonder which senior civil servant in the early 1980s came up with the philosophy that since competition in the soon-to-be privatised utilities did not exist, it was necessary to have a surrogate. The questions we have to ask are whether that surrogate is working as it should, whether or not it is based on the original criteria of Professor Littlechild, or are the United Kingdom regulators increasingly trading certainty for flexibility, and, in the process, risking stop-go regulation; and, at the same time, is it evolving into a discretionary system where negotiations and personality are becoming its most important features? I suggest that the second concept is closer to the truth than the first.
In the water industry, for instance, the director general is now, after hectoring and badgering the 10 large and 29 original private sector operators—an operation which has led some, but not me incidentally, to question whether it is the regulator or the boards which run the water industry of the 1990s—in full possession of their cost data for water treatment, and, where appropriate, for sewage treatment, as well as the results of the pre-privatisation scrutiny into efficiency and capital investment targets. It was those that persuaded the Government to set strict limits on the amount by which they can be allowed—by differing amounts incidentally—to increase their
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charges. We are talking about increases in this case—and this answers the noble Lord, Lord Hampton—because, as we know, there is a vast capital programme of £25 billion over 10 years with possibly a further £10 billion after that to be paid for out of profits, plus borrowings, required by the EC and national legislation, to say nothing of the need to provide more water for impoverished parts of the country and to reduce the 25 per cent. leakage rate.
In a speech that I made outside the Chamber some 18 months ago, I said that in my view the biggest barrier to planning in the 1990s would be the absence of new supplies of water to support the industries and houses that required it. That is not necessarily a bad thing. It could well be that market forces will force construction projects away from the comparative drought areas of the South and East to places such as Wales and the North of England where there is almost a superfluity. Even so, can Southern Water plc support the enormous expansion of business and housing which will result from the Channel Tunnel, for example? Will the regulators allow it even if the company wants to do so?
Yes, regulators in the plural. That is a point that the noble Lord, Lord Ezra, made in part. The water industry has to contend not just with the economic regulator (Ofwat), with the possible intervention of the old economic regulators, the Office of Fair Trading, with ultimate recourse to the MMC, as he said, but also with the environmental regulators; namely, its sponsoring department, the NRA, the Drinking Water Inspectorate, Her Majesty ;'s Inspectorate of Pollution, and, last but not least, the Ministry of Agriculture, Fisheries and Food. Over and above that, and most important of all in the context in which I am now speaking, there are the planning Acts, passed by Parliament over the years and administered by the DoE. That is a heavy load of regulation; and not all those bodies pull the same way. I find that a heavy irony.
For many years now we in the House have called for more reservoirs in the South East. They have been planned but never built due to the negative activities of the very people who now complain of low river levels, water rationing, hose-pipe bans, and the like. That reminds me of a story in the current issue of the magazine Police. At two o'clock on a Sunday morning, two constables were checking the driver and contents of a van. After some time they professed themselves satisfied and told the driver that he could proceed. As they settled themselves into their police car, the van driver ran back and said, "Can you give us a push? My battery has gone flat because I left the headlights on." The police driver replied, "You've got to be joking. It's your fault for leaving your lights on". Whereupon, he turned the key in his ignition only to find that, due to leaving the lights on … "Oh well" as Frankie Howerd used to say, "please yourselves!"
That said, despite undoubted strides in efficiency and environmental improvements, even by gazing deep into my crystal ball I cannot see any prospect of regulation in the water industry being removed, at least for water delivery, although one could argue differently for water supply and treatment. At the

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moment though, as the noble Lord, Lord Hampton, said, it is a monopoly, but does it need so many regulators? If the excellent and increasingly effective activities of the NRA are to stay, and I hope that they will —having played a part in creating it, I have more than a soft spot for it despite its teething troubles, —do we need the activities of HMIP, or the environmental agency as it will become, as well as the Drinking Water Inspectorate? All those regulators could and should be rolled into one which, for my money, would be an expanded NRA which could, but need not necessarily, also comprise the regulation of land disposal of sewage sludge under the firm policy discretion of the DoE, which is not, as it is regularly accused by the water companies, creating policy itself and then operating it. What is certain is that Sir Ian Byatt must be right when he says in his annual report:
"Companies and the regulators"—
again, note the regulators—
"should concentrate on the service provided to customers and the recoverable costs of achieving specified levels of service, rather than on the achievement of particular levels of spending".
He is doubly right if that is a veiled way of saying that all the regulators should pull in the same direction, which is what I understand him to mean. Even with the current system however, it is noticeable that Switzerland and Britain are the only European countries that exceed a 99 per cent. compliance rate for sewage treatment works and drinking water.
The debate initiated by the noble Lord, Lord Ezra, goes much wider than the water industry. If competition in the water industry will never arise, the same cannot be said of telecommunications or the gas industry, or, slightly further down the track, the electricity generating industry. In all those industries fledgling competition exists. We all applaud the efforts of my noble friend Lord Young who, as chairman of Mercury Communications, has shown in his recently published annual report that even in the deepest recession since the war it is possible to take on a vast company, making vast profits, and dent them substantially. More power to his elbow. I should like to see the day come when Oftel will no longer be necessary. In order to achieve that it is essential to introduce more competition into the industry with more operators coming on stream and competing successfully. They will be helped, of course, in the early stages by the regulator who has, after a settling down period, seen the need dramatically to change the permitted pricing formula by increasing the X factor from 3 to 7½ per cent. At the same time, he has attempted to promote investment in infrastructure like optical cabling and underground lines. All this has to be paid for out of the very profits of which people complain. My noble friend Lady Seccombe made that point.
In this connection, I was particularly interested to note a comment in the brief of the director general of OFFER, circulated for this debate, that today's profits are the result of yesterday's prices. Both a threat to the utilities and their investors, and a promise to their customers are contained in those words. Those profits also have to cover dividends to the
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shareholders, large and small—the Ernies and Sids of this world whom the Government successfully succeeded in persuading to invest in dynamic companies—and, of course, corporation tax.
The Government have a vested interest here. Despite the efforts of the past 13 years to restrain government borrowing, the need for an increasing total tax take is readily apparent. Therefore, the regulator at the moment has an enormous job in squaring the circle. Does this lend weight, I wonder, to Plato's comment, "God is a geometrician"?
To be serious, though, the economic regulators face many pressures at the moment, not least from customers who simply do not seem to understand that in order to invest in the very things about which they care, large profits have to be made. The press were until recently similarly confused. They delighted in knocking the utilities. I wonder whether the tide of opinion is now turning. In a leading article in the business section of the Evening Standard last Friday, I detected the sentences:
"No doubt the regulator will want to take due credit for his part in ensuring that British Gas serves its customers well. However, the law of diminishing returns suggests that at some point it becomes counter productive to try and improve that performance any further. That point is close to being reached".
Whether I am right or wrong about that, the debate on the activities of the regulators is increasingly swinging round to the complex and controversial problem of the cost of capital. This is central to the future well-being of all the utilities, with possible significant long-term consequences to investors. Regulators already have to form some view about the acceptable rate of return for companies and I have to ask my noble friend how real is the danger of a change in emphasis from price regulation to rate of return regulation. Certainly, the writing is on the wall as concerns Ofwat. I understand that Sir Ian Byatt is consulting on this point at the moment. That would be contrary both to the original policy intention and to the expectations of investors. Has the policy of the DTI changed since the election or does my noble friend's department still believe that regulation will be better focused on what the customer wants and expects?
That is all very well, but regulation is here to stay, at least for the moment. A level playing field and an open framework are essential. This, of course, means that there should be no sudden swings in direction by anyone—the regulator or the regulated. The utilities are under huge pressures from regulators, in turn resulting from just as great pressures from the media, politicians and customers—populist pressures, one might call them, which are in danger of forcing the pace of benefits in the environmental, competitive and consumer fields, faster than was originally intended. I believe that the utilities would accept that, so removing an unnecessary layer of tension between them and the regulators, if they saw economic regulations being removed at some time in the future.
Let us take, for example, gas. If my honourable friend Mr. Eggar, in his review of the monopoly threshold in gas in 1993, which has already reduced tenfold since 1991, were to say that he would wait to

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see how his new and as yet unspecified reduction was working before he would consider removing the regulator, it would be a step in the right direction. The question is: can he ever afford to do it politically? What about the public interest? My answer is yes, he can and that the latter is already covered. Anti-competitive practices are already controlled by the Monopolies and Mergers Commission and the Office of Fair Trading, as the gas industry knows well. Regular reviews are undertaken into all these industries. The brewery and the petroleum industries spring readily to mind. My noble friend may remember the cement industry some years ago. Consumer legislation remains, environmental legislation remains. Competition would be in place. If he were not satisfied, he would not do it, for gas, telecoms, electricity generation or whatever. If he is satisfied, there is a positive danger in not doing it, a danger already identified in depressed share prices.
My final question is: is it true that because competition already exists, there are no plans for the establishment of Offcor—the Office of Coal Regulation? If it is true, my case is made.
6.56 p.m.
Viscount Hanworth: My Lords, before considering how the electrical generating and distribution industry is progressing since privatisation I think we should consider government policies in this respect. It seems to me that governments become extremists in some of their policies. We have moved from the socialist doctrine of nationalisation to that of Thatcherism, where anything which trades should be privatised, regardless. We still seem to be stuck with that dogma. Where there is adequate competition, privatisation does have advantages, but there is always the danger that a decision made for commercial interests will be short-sighted and not always in the national interest.
In the electrical generating and distribution industry very little competition is possible; and none at all in the 12 regional distribution boards. I remember during the passage of the privatising Bill the Government argued that comparison between different distribution boards could provide a measure of competition. Since local conditions vary enormously I think that argument is largely invalid.
As regards generation, it must be realised that with an alternating current grid it is technically impossible to move large quantities of power—say, one megawatt or more—further than about 120 miles without destabilising the grid. Thus, here again competition is limited.
Already, I think it is quite clear that without an independent director general or regulator the new privatised system would be in real trouble. The pool system of payment for electricity generated and for allied or independent contracts is thought to need complete overhaul. It is in any case very complicated.
The director general has considerable powers but, even so, whether these are adequate is another matter. If not, where is privatisation leading? If we read the conclusions and recommendations of the report of the House of Commons Select Committee on Energy, entitled Consequences of Electricity Privatisation, we
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see the amount of action suggested for the director general. Although the move towards combined cycle gas generation stations has the advantage of reducing pollution, I think we should not allow this tendency to go too far. This is, first, because gas is a premium fuel —its reserves are limited and prices will undoubtedly rise—and, secondly, although at present we have spare generating capacity several large stations are nearing the end of their lives. I am concerned that the siting of new stations must take that into account.
Most unfortunately, I missed introducing my short debate on 10th June. Perhaps I may be forgiven for mentioning briefly two subjects which I then intended to raise. There is a need to encourage the market by introducing a system for assessing house insulation without waiting for an EC standard. I believe that at least two other countries have already done that. There is an environmental limit to the amount of power which we can provide from on-land wind turbines. In the end we may have to pay the extra cost of putting them out to sea; for example, in the Wash. If I am right, we need to try this out now and perhaps the extra cost in adverse sea conditions may not be as large as at first thought.
On another matter, I am concerned that, since privatisation, research and development in the industry have been greatly reduced. I should like to know what arrangements there are to ensure that these limited resources are targeted to what is in the best interest of the industry as a whole. I must say that in my view the Government's commitment to energy conservation is not well served. The power and importance granted to the Government's energy department are wholly inadequate, as its performance in the past seems to demonstrate.
Finally, the picture is gloomy as regards gas with hardly any of the objectives of privatisation within sight. The situation has only been saved from disaster by the regulator.
7.1 p.m.
The Earl of Lindsay: My Lords, I am grateful to the noble Lord, Lord Ezra, for raising such an important subject. I must also declare an interest, even more modest than the personal equity plan of the noble Lord, Lord Hampton, in that I have 100 shares in Scottish Power. However, much of what I shall say is based on my experience of environmental issues.
When vital industries evolve from being state-owned monopolies to private sector concerns, some safeguard may be needed against those elements of monopoly or duopoly that remain. The role of the regulators in preventing abuses and inefficiencies on behalf of the customer is therefore clear.
However, in the case of energy and water it may well be that the regulators should be looking much further if they are properly to protect the best interests of the customer and the public. For both those industries the next two decades will present a significant challenge. New levels of demand in terms of both quantity and quality, and increasingly costly environmental requirements, will force considerable investment in capacity, supply and their associated technologies.

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In electricity generation, for example, we currently derive 77 per cent. of our electricity from coal-fired power stations, but two-thirds of those stations will be at or beyond the end of their designed lifespans early in the next century. Investment in new power generation, whatever its fuel, takes not only considerable sums of money but also a considerable amount of time. Such long-term undertakings require both a strong financial base and substantial confidence in the future viability of the industry. Strategic undertakings of a similar magnitude will also he involved in obligatory environmental improvements. With progressively strict limits on emissions coming into force, the generators will face bills of some £1.6 billion to reduce the sulphur emissions by just 8,000 megawatts.
National Power is spending £700 million at Drax. Scottish Power estimates an investment of up to £400 million in flue gas desulphurisation despite 60 per cent. of Scottish Power's electricity coming from nuclear and hydro sources and also despite the fact that Scottish coal has one of the lowest sulphur contents of coal in Europe. It is imperative for us all that these environmental obligations are properly met but the financial commitment they entail is both sizeable and continuous.
Scottish Power's £400 million investment or the industry's £1.6 billion investment cover only the first of a progressive series of obligatory sulphur dioxide reductions. That investment does not cover the other constituent of acid rain, nitrous oxide—National Power will spend £100 million reducing nitrous oxide emissions—nor does it tackle the emissions of the main greenhouse gas, carbon dioxide. Nor, furthermore, does such expenditure cover the protracted parallel funding involved in the development of new processes. A further 18 years of investment are needed, for instance, before clean coal technologies will be suitable for a 1,000 megawatt power station.
I have used electricity generation as one example of the scale and complexity of the challenges that face energy and water companies. If one accepts that these challenges exist, one has to hope that the companies involved are in a position to respond effectively. If they are not, it is the customer and our environment that stand to suffer most. Therefore the customer and the environment should welcome the profitability of the water companies. Some 70 per cent. of their profits are being reinvested in a £28 billion programme over 10 years.
A similar welcome should be given to National Power's ability to fund a £1 billion investment in the more efficient and environmentally preferable combined cycle gas turbines and its £40 million investment in sophisticated dust removal equipment. It is therefore vital that the regulators incorporate a strategic view into their assessment. This is the context within which the pricing, profits and performance of private utility companies must be judged. The exercise of such judgment must in turn be the vehicle by which regulators actively encourage long-term planning by the companies.
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One has to question the wisdom of those opposition commentators who indulge in snapshot swipes at retrospective balance sheets without any assessment of forthcoming obligations. The shadow Minister for Trade and Industry, for example, moans about last year's water profits amounting to £68 per household and ignores last year's investment programme which was worth £126 per household. An obsession with profits demonstrates a failure of vision. However, it may also suggest that one of the challenges facing the privatised companies is one of public relations.
As both a customer of private utility companies and, more importantly, as someone who has some experience of the environmental field, I strongly believe that if there is an obsession it should be that investment, technology and practice are the criteria for assessing performance and that the regulators should assume a responsibility for encouraging a commitment to these principles within their industries.
There are legitimate fears, for example, that the demise of the CEGB's technical research departments is one factor that will seriously exacerbate anticipated electricity supply problems towards the end of this decade and that the consequence will be an increased likelihood of widespread power cuts during periods of peak demand. However, I see no reason why the method by which the industry's prices and profits are regulated should not directly ensure both the necessary research and the necessary capacity.
It is certainly in the national interest that the profit motive is harnessed to the incentive to invest. If a regulator sanctions energy prices and profit levels on the basis of impending obligations and improvements, he is effectively guaranteeing funds to the future well-being of that industry, its customers and the environment.
There is, in addition, one more important dimension of water and energy which the noble Lord, Lord Ezra, has already mentioned and which falls neatly to the regulator. In privatised industries it is difficult to motivate effective conservation and efficiency of use when those industries are driven primarily by the commercial incentives of increased consumption. Why strive for reduced consumption among one's consumers if that simply represents lost revenue at the end of the day.
In the United States of America conservation and efficiency measures have been successfully introduced through the regulators. That deserves careful study. The essential factor is that investment by energy companies in the promotion and installation of energy saving is taken into account by the American regulators in their assessment of acceptable profits. The larger and more successful a utility company's commitment to savings among its consumers, the larger the permissible return on capital for that company.
The California Energy Commission, which is the equivalent of our Office of Electricity Regulation, went further. After convening a group from all parts of its energy industry, it identified two additional motives. The first was that the power companies themselves should expand their services to include the sale or rental of the expertise and facilities needed for

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conservation. A similar approach is evident in the Netherlands where the energy companies will install solar panels for their customers on a rental basis, the rent being charged on to their electricity bills. The means for conservation therefore are made commercially attractive in their own right quite apart from the bonus points they score with the regulator when he assesses acceptable profit levels.
The second initiative in California, although more intrusive and more ad hoc, is nevertheless revealing as a procedure. On being faced with a proposal for a new power station to meet an anticipated rise in demand, the California Energy Commission identified the potential for an equivalent amount of energy savings through conservation and efficiency measures. Given that demand could be stabilised, it queried the huge costs the power company was bringing on both itself, in terms of new plant and new infrastructure, and on the environment in terms of land take and emissions.
The commission acted prudently and everyone gained. Demand was stabilised through energy savings; those savings qualified the company for a greater return on capital and the power company avoided the costs of an additional power station, as did the environment. Although net total demand stablised, the number of customers rose and therefore so did the revenue earned from standing charges and connection charges.
It seems sensible that one of the criteria for judging the acceptability of profits should be a successful commitment to conservation and efficiency, whether it he water or energy. For both industries such an approach will be the most cost-effective method of tackling environmental problems. It is undoubtedly the case that in relation to carbon dioxide emissions the answer is reduced consumption.
I believe that the regulators have a crucial and demanding role to play. That will not be made any easier by external distractions. It is likely that they will attract vocal opposition from one quarter or another, however shrewd their policies. They will also have to contend with the repercussions within their own markets of government policy on, for instance, nuclear power and coal privatisation. What are the regulator's duties if the Government's views on how much of each fuel source should be used for generation are at odds with either the views of the generators or the regulator's own assessment of what is in the customer's best interests.
I welcome the privatisation of British Coal. However, are the short-term requirements of a successful privatisation distorting the regulation of an energy industry which has signalled a growing preference for gas-fired generation? Such questions arise given that the regulators have a duty to promote independent sources of generation. Some 6,000 megawatts have been approved, but applications for a further 14,000 megawatts appear to have been lost in the DTI's pending trays. I believe that that is a contradiction of the duties of the regulators. It may be that in the energy field the regulators as well as the companies at present have to contend with a government long-term energy strategy which is either
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poorly formed or poorly explained. I should be delighted if my noble friend the Minister could show that assertion to be false.
The final intrusion upon the regulators comes, of course, from the European Community. EC pronouncements on water are already plentiful. Energy generation, energy use and associated issues such as the carbon tax are the type of macro-subjects that are likely to transcend any claims to subsidiarity and tempt the use of EC regulations rather than directives. I believe that those will cut into the regulators' duties in coming years.
In conclusion, the water and energy industries face challenges which they must be able to meet and must be made to meet. Much of the responsibility, however, will fall on the regulators. The noble Lord, Lord Ezra, posed some interesting questions about the long-term status of regulators. I do not believe in the existence of regulators as an end in itself. I do, however, believe in achieving strategic objectives where regulators provide the necessary means. It is in that role that I see them being a permanent fixture.
It is the regulators who are in the best position to insist on and foster investment in better capacity, better technology, better usage, better service and better environmental practice. For the sake of the custonier and the environment, therefore, it is not only the water and energy companies which must be preparing for the next decade but the regulators as well.
7.12 p.m.
Lord Holme of Cheltenham: My Lords, I am sure that the whole House will want to thank the noble Lord, Lord Ezra, not only for introducing the debate on this extremely important subject but also for the authoritative and comprehensive way in which he set out some of the issues. I hope that he is not too disappointed by the relative paucity of speakers who wish to contribute to the debate. If he is, I expect that he will be consoled by the quality of contributions made by noble Lords in the past hour.
I should like to speak in particular about the role of the regulators because it seems to me that what we are discussing here is one of the most important developments in our public life, which in a sense has crept up on us. Ten years ago although the word regulator was familiar in the United States it was barely known in this country. Yet now there are regulators on the interface between the economy, the Government and the consumer, playing a vital role and one which I suspect is now permanent. The reason I suspect it is permanent is that we have seen in this country, as in all advanced economies, the comprehensive defeat of state direction, of state intervention and of collectivism. Yet, when the state has been defeated, or, as the Government would put it, rolled-back, a case still has to be made for the public interest. Nowhere does the case for the public interest have to be made more strongly—and I am sure that this is what the Government had in mind with the Citizen's Charter—than in the case of privatised utilities, particularly of the genuinely natural monopoly.

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Although I speak as a supporter of privatisation, in the case of every industry which the Government privatised, I am one of those who does not believe that the Government handled privatisation particularly well, for this reason. I believe that under the malign influence of the Treasury the Government were more concerned in each of those privatisations with the revenue which was immediately received by the Exchequer than with ensuring, for instance, access to services for the poorest and most distant or with enlarging competition.
Even in relation to the sale of the shares themselves I believe that the Government were not genuinely concerned with dispersing long-term ownership so much as with offering the prospect of short-term speculative gain. Paradoxically, most of the people who bought privatisation shares would have been better off taking the short-term speculative gain; but, nevertheless, I believe that the aim would have been better achieved if more people had been given the incentive to hold on to their shares for a long time so that the genuinely share-owning democracy which the Government said that they wished to create would have had a better chance.
That in a sense, is a digression. I am simply trying to say that the process of privatisation was confused by the Government's mixed motives.
Therefore, as my noble friend Lord Ezra said, the regulators have in some instances been handed for resolution fundamental issues of policy which the Government should have addressed at the time of privatisation. Perhaps I may just instance Part I of the Telecommunications Act 1984. The director of OFTEL has been left with extremely difficult policy questions to resolve in the course of day-to-day regulation relating to securing universal access, promoting competition, promoting the interests of the consumers and, for instance, of promoting the interests of BT abroad. That is a very mixed bag of responsibilities for one regulator, some of them matters of policy which the Government themselves should probably have resolved at the time of privatisation.
In that instance, we have been very fortunate in the first regulator, Sir Bryan Carsberg. I should like to associate myself with the remarks of the noble Baroness, Lady Seccombe, on that point. I should like to ask the noble Baroness, Lady Denton, to say when she replies whether it is the Government's intention to ensure that Sir Bryan's successor is as committed to competition as the first holder of the OFTEL job.
We have seen a great change in governmental culture. I remember that when privatisation started, regulation was almost a dirty word. In those days the Government said that they wanted "light touch" regulation. It would be interesting to hear from the Government whether they now accept that the regulator has a vital and permanent role to play in the public interest, and that the touch should be as heavy as the situation demands.
Where there is not a natural monopoly, which is the case in some privatised industries, there should be more competition. That has been our position on
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these Benches consistently, as my noble friend said at the beginning of the debate. Where there is a natural monopoly, I still believe that there is scope for more prompting of the best instincts of commercial practice on the part of those monopoly interests. There could be more regionalisation so that benchmarks are provided against which progress could be measured. There could be more franchising and more open networks to provide the benefits of discipline within natural monopoly industries.
On the whole, in the case of the genuine natural monopolies, I am inclined to believe that the price cap works best. However, I was struck by the point made by the noble Earl concerning the whole question of rate of return calculations as generally used by US regulators. Rate of return seems to offer an interesting prospect where heavy capital investment is required, as in the case of the water industry. I should be interested to know—sharing the Government's apparent prejudice, as I do, in favour of price caps as the best way —whether it is in their mind to look in certain industries where heavy investment is necessary (for instance because of environmental demands), more closely also at the rate of return calculation. This is a question to which the noble Lord, Lord Skelmersdale, referred.
I should like to raise a specific point about the regional electricity companies and British Gas, where it seems to me that household consumers are particularly vulnerable. There are a large number of disconnections, and disconnections in the case of water have been referred to by my noble friend Lord Hampton. I have two questions to put to the Government.
First, would it not be better if all privatised industries had some kind of code on the basis of the guidelines that Ofwat have prepared, dealing with the very difficult question of disconnection? It often happens to the poorest customers and those who are least able to cope with the whole process of billing and invoicing, let alone paying the bills. Every attempt should be made to contact the delinquent consumers and talk to them directly to see what provision can be made for payment of one kind or another.
Competition in the utility sectors will not always happen of its own accord, even when regulatory rules preventing entry into the market are removed. The reason is that the dominant incumbents have enormous market power. My noble friend Lord Ezra referred to that point. Even when those dominant incumbents are theoretically open to challenge, they stand astride the market. Therefore it seems to us on these Benches that proactive policies are necessary to promote competition and to tilt the playing field in favour of new entrants. The promotion of competition and tough regulatory action go hand in hand, for example, to prevent discriminatory pricing by a dominant incumbent against new rivals. For instance, in telecommunications the crucial issue is BT's monopoly of interconnection. To give new competitors a fair chance, restructuring the privatised industries is likely to be necessary because a perfectly integrated utility has tremendous power to manipulate prices to its own advantage.

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Another point is that in our opinion the regulators of privatised utilities need to be granted wider and tougher powers in order to do their job more effectively. We believe that they should be given the powers given to the European Commission under the Treaty of' Rome to obtain access to company records and to impose penal fines for anti-competitive behaviour. They should be properly staffed with professional economists, accountants and industry engineers.
Even if the regulators stay separate—I believe it is right that there should be a separate regulator for each of those great industries—I wonder whether more could be done to pool their professional support staff in some sort of office of utility regulation, so that each industry, continuing with its own regulator and clearly independent of government, nevertheless should have the ability to respond to special demands upon it.
I come to the question of environmental regulation to which the noble Earl referred. I do not believe that the separate roles of economic and environmental regulation of privatised utilities should be confused. Decisions about the environmental standards to apply should be made on a social cost/benefit basis by environmental regulators. For example, standards of drinking water quality should be set independently of the regulator responsible for determining increases in water charges.
If greater competition in energy leads to lower prices and higher levels of consumption than are environmentally sustainable, the issue should be tackled through the energy tax mix. Or, when there is a need to subsidise rail services, either on regional policy grounds or because in urban areas car users do not pay the full social and environmental costs they impose, that should not be a barrier to the operation of a franchising system if it is right on other grounds.
Perhaps I may offer a final and radical thought. I wonder whether regulators, who after all are the servants of the public interest and originally had their duties defined by Parliament, should not report regularly either to a Select Committee of both Houses of Parliament or a standing committee and include in their annual reports recommendations for any change in the regimes that would make it easier for them to exercise their responsibilities.
I believe that there is not only a danger for regulators in being co-opted into the culture and assumptions of the dominant suppliers with whom they deal, but an equally great danger of them forming too close an incestuous relationship with Whitehall, as though they were quasi-civil servants. They are not quasi-civil servants; they are the servants of the public interest. I believe that Parliament has a legitimate interest in the exercise of their duties.
The experience of utility regulation has important lessons for the approach that the Government should adopt to the economy. It should focus on the need for an armoury of weapons to attack monopoly power. It demonstrates how important public interest objectives can be achieved by effective regulation, without the need for public ownership or day to day ministerial and Whitehall interference. Finally, it highlights the
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centrality of the commitment to competition as ultimately being the best guarantee of efficiency and consumer choice.
7.26 p.m.
Lord Clinton-Davis: My Lords, perhaps I may say at the outset that I agree with a very large number of the points made by the noble Lord, Lord Holme, and that means that I do not have to rehearse some of them now. There is little doubt that there is growing concern about certain developments and trends in the operation of the privatised utilities and the role of the regulators, even though many of the points have gone unrecognised by noble Lords on the Government side of the House. The House is indebted to the noble Lord, Lord Ezra, for having initiated this debate.
The noble Lord, Lord Holme, mentioned the importance of investing the regulator with additional powers. It is extremely important. I shall not say any more about it but I hope that the Minister will reply specifically to that point.
I want to take up the point made initially by the noble Lord, Lord Ezra, who argued forcefully for a strong system of consumer representation. I go along with that wholly. There is no independent national body to represent consumer interests in some of the privatised utilities. That needs to he addressed, particularly in regard to the energy industry.
There is another issue which was not mentioned in the debate other than in passing: namely, the conflict of interest that sometimes arises between the national interest and the public utility involved. Prior to this debate I received a considerable volume of material from consumer organisations and some public utilities. Over and over again we hear the Government say that they are committed to the Citizen's Charter for public utilities so far as concerns setting service standards and causing them to adopt and publicise complaints procedures which should be adequate. We shall wait to see how efficacious are those developments. I wish them well. They are important in terms of consumer protection.
If one reflects on the material that has been sent to noble Lords, for example by citizens advice bureaux and national consumer councils, it is clear that at the moment there are real concerns, which for the most part afflict the most vulnerable members of society: the poor, the aged and the disabled. I believe that the Minister will share that concern as I know her well enough and have a high regard for her. But the test lies in what she will be able to accomplish in addressing those concerns. At all events we wish her well in that endeavour.
The citizens advice bureaux have cited some telling and deplorable examples of hardship on the part of consumers. Noble Lords opposite have not mentioned that at all. They have not said one word about it. I find that extraordinary. I refer to people who have been denied access to a telephone service because of the imposition of deposits, installation or reconnection charges which are out of sight for them.
Let me give an example of the kind of thing that occurs in the water industry. A CAB in the West Midlands reports that South Staffordshire Water

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Company disconnected a water supply of a client with a seriously disabled child. The company required a reconnection fee of £94 which the client could not afford. Mid Kent Water disconnected the supply of a client who was over 80 per cent. disabled. The company then refused to negotiate with the CAB, requesting instead that the social services should intercede on the client's behalf. A large number of cases have been cited but not addressed.
The setting of performance standards which affect the vulnerable people to whom I have referred needs further attention. However, disconnections constitute the major issue which we in this House need to consider. I hope that the Minister will do so. The deprivation of water supplies can be a devastating blow to someone's quality of life, health and even self-respect. I have seen much material from the privatised utilities. I fear that others have not bothered to forward it although I should have thought that they would have taken the opportunity of this debate to ensure that noble Lords know about their case. However, I have received little evidence that the essential anxieties that I have addressed have been noted, let alone dealt with adequately. I ask the question: why not? Did the Government not know? Did they not bother to find out? Did they care too little or are they prepared to ride over the hostile criticism which sometimes might emerge? It is simply not good enough. Those cases, after all, arise against a background of quite extraordinary rises in profits and increases in salaries of chairmen and senior executives almost across the board with regard to the monopoly suppliers.
I hear the arguments about investment. In part they are true, but not completely. Let us take, for example, the National Grid Company. It has had a 30 per cent. profit increase. No one can doubt that it is a monopoly on which consumers are totally dependent for supplies. Let us take the example of the Merseyside and North Wales Electricity Board (rejoicing under the highly appropriate acronym of Manweb). Profits increased by 16 per cent. to more than £94 million. That represents about £72 for each of the companies' customers. A privatised monopoly purveying services on which families and businesses have to rely comes within that category. Can it really justify to the satisfaction of the public that the huge increases across the board are reasonably appropriate in the circumstances against which this country battles at present? There is the deepest, most enduring recession; a massive number of insolvencies, and vast unemployment, with 70,000 families having their homes repossessed. That is the background. It is little wonder that there is considerable bitterness and worry by many consumers, in particular those whom I have identified.
The common denominator which worries the ordinary consumers is that they are at the mercy of the privatised monopolies. For most people there is simply no competition for telephone services. It is true that there is a kind of choice for people between whether they use gas or electricity in their homes. But once the choice is exercised as to which route one goes
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down then to all intents and purposes a monopoly exists for the customer. Relatively few people in this day and age use gas rather than electricity to light their homes.
I say that the consumers are at their mercy because very few people can comprehend the pricing formulae used by the services. That is a real handicap to being able to challenge the pricing formulae. The cost of electricity is essentially geared to the generating process. There is therefore little control by OFFER over National Power and PowerGen. Useful ideas have been advanced by the National Consumer Council for dealing with a number of important issues. I refer to excess profits made during a recession and excess profits based on wrong inflationary predictions. The council argues that we ought to be exploring ways and means of ensuring that those excesses should result in compensation for the customer. I should like to hear the Minister on that.
I do not believe that in most instances the criteria for disconnections have been explained properly or at all. I ask the Minister a number of questions of which I have given her notice. Why should not the Government, in the light of the experience that we have had since the enactment of the Competition and Service (Utilities) Act at least state in the debate tonight that they will consider the proposals that have been made by a number of consumer bodies? I repeat them. First, deposits charged should be reasonable. Secondly, there should be a definition of low income consumers in order further to clarify the position. Thirdly, there should be no disconnections—in particular with regard to water because that is the most important of all the services offered—unless a customer has wilfully refused or culpably neglected to pay the charge in question. I believe that those are perfectly reasonable propositions. I await with interest what the Minister has to say.
The fact remains that there are far too many disconnections at present. Water disconnection figures for 1991–92 show a rise of 177 per cent. over last year. Nearly 22,000 households have been disconnected. Surely that requires some urgent attention. It surely requires attention along the lines that I have been suggesting.
Up to 31st March 1992, gas disconnections were running at the rate of nearly 20,000 a year, up by 21 per cent. over the previous year. I again ask: why have we not heard anything from the other side of the House about that? Does it not worry them? If noble Lords on the other side were in another place they would have had a sheaf of letters from constituents complaining about such issues. The fact that we are in this Chamber should not insulate us from that situation.
While this state of affairs persists it is obvious that the regulators—whose job unquestionably is very difficult indeed—must be seen to be doing more to protect the vulnerable, and Government have a role in that respect too.
I end on this note. I suggest that a national conference should be convened by the Government at which there would be a full exchange of views by the

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utilities—privatised companies or privateers—customer bodies and the regulators. I commend that idea to the Minister. Again, I have given her notice of it.
7.40 p.m.
The Parliamentary Under-Secretary of State, Department of Trade and Industry (Baroness Denton of Wakefield): My Lords, I welcome the opportunity provided by the noble Lord, Lord Ezra, to debate an important subject of wide public interest. As was said by my noble friend Lady Seccombe, it is appropriate that we should do so today when the first part of the Competition and Service (Utilities) Act comes into effect. Furthermore, as requested by the Director General of Ofgas, the British Gas tariff reductions also come into effect today. I hope that that will go part of the way to convince the noble Viscount, Lord Hanworth, that the picture is not as gloomy as he would have us believe. Perhaps in passing I may say how pleased I am that the noble Viscount is present today. We missed his input on the previous occasion on which the House debated the energy issue.
A large number of important points have been raised and I shall endeavour to answer as many as possible. Since having had the privilege of replying for the Government I have discovered that noble Lords have never been short of questions for me to answer.
The privatised utilities touch everyone and every company in the country. All of us take a keen interest in their prices and quality of service. The Government are well aware of that. Indeed, it was a desire to improve the performance and service of the utilities that led the Government to privatise them. The same concern about the quality of public services lies behind the Citizen's Charter. I am pleased to be able to reassure the noble Lord, Lord Clinton-Davis, who was kind enough to recognise my concern for the consumer, that we take the matter seriously. We are anxious to ensure that the regulators have close links with the consumer bodies. In the evidence which the noble Lord brought to his speech he showed that there are strong consumer representations. However, it was sad that the briefing from the Citizens Advice Bureaux was not also sent to the Government, although I accept that we are in constant communication.
The noble Lord, Lord Holme, made some interesting points about privatisation. It is, of course, easy to comment on some of those with hindsight. I can assure the noble Lord that decisions were taken by the Secretary of State in agreement with the Treasury and in the light of much expert advice.
We should not in this debate lose sight of the purpose of privatisation. It has resulted in major improvements in the services provided to domestic and commercial consumers and in the efficiency of the utility businesses, as was pointed out by some of my noble friends. The utilities are now subject to commercial disciplines and we are making them compete for the market wherever possible. It must be remembered that before privatisation standards of service were poor and there was frequent government interference with prices and the running of the htlinesses. That often occurred due to public
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expenditure constraints and political decisions about priorities which could not be described as being customer-driven.
I was grateful to the noble Lord, Lord Ezra, for recognising some of the substantial achievements and improvements that have been made. For example, under all governments before privatisation the public funding found for investment in water and sewerage services was very limited. Now investment is at record levels and more than twice the average level of the late 1970s. The water companies are investing nearly £1,000 per household in the five years to 1995. We should be most careful about arguments that government should again become closely involved in regulatory pricing decisions. That is not the way to secure efficient services.
The role of the regulators has been questioned by your Lordships. It was the Government's view that it was not sensible at the outset to try to establish full competition in all the utility markets. In our view the transition from state monopoly to competitive supply must be managed in steps. I am sure the Russians would agree with that. Therefore, we provided for the progressive development of competition and introduced independent regulators to foster, among other things, competition and the protection of consumers against the abuse of monopoly power while competition develops.
The Government believe that it is for the independent regulator to judge how to balance his —and perhaps some day her—various responsibilities when reaching a regulatory decision with the minimum political interference. The regulators have been given strong powers to match their responsibilities. They administer the licence regimes for the utilities and those can include fixed-period caps on price increases and controls on the terms of access to the wire and pipe networks through which services are delivered.
The regulator can propose changes in the licence conditions, including the price controls. If the company does not agree the regulator can refer those proposals to the Monopolies and Mergers Commission to take a view on the public interest. The regulator can also refer a company to the MMC to consider whether its monopoly position is itself working against the public interest. Those are considerable powers and, like the Director General of Fair Trading, the utility regulators have discretion over their use. I am grateful to the noble Lord, Lord Ezra, for pointing out the contribution made by the regulators and the enormous amount of work and effort they have put into taking their roles seriously.
The noble Lord, Lord Hampton, drew attention, correctly and with great concern, to the water shortage issue. Perhaps that is a subject for another debate and not one on which I wish to dwell too long tonight. The Secretary of State for the Environment is preparing a consultation paper on water conservation, to be published soon. There is a great need to encourage people to take seriously water conservation. All water companies are required to adopt efficient and

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economical practices in the use of water and to encourage economy on the part of users. However, there is a huge task to be undertaken.
The noble Lord, Lord Hampton, also asked about K factors for the water industry price caps when the present regime was introduced. Those K factors were set during 1989/90. There was extensive consultation at that time and account was taken of all known commitments which could be quantified. Where an item could not be fully costed, provision existed for a cost pass through revision of K to reflect that individual cost. That was a matter that I had to investigate. The type of situation we are talking about is when compliance costs of sewerage treatment could change or when, in the period 1989/90, investment factors were based on original costs which could have increased and were not as had originally been supposed. The operating licences for the companies also provide for an interim review by the regulator should any relevant change in circumstances occur outside the control of the companies. I am sure that the noble Lord, Lord Hampton, will agree that my noble friend Lady Blatch is one of the most courteous Members of this House and I am sure that she would not have wished to be unable to reply to his letter.
In a most interesting contribution my noble friend Lord Skelmersdale asked whether, when full competition has emerged, the regulators will still be required or will disappear. As competition strengthens the need for regulation should diminish. But careful regulation—or, as was said, the light or heavy touch of regulation—will still be necessary to protect competitors and consumers while companies have dominant market positions.
There are also the natural monopoly networks, to which many of your Lordships have referred, of the wires and pipes which carry utility services to the consumer. As far as we can see, those elements will always need regulation. However, the coal industry is already competitive and will become increasingly so. It will not necessarily have the same needs as other utilities.
My noble friend Lord Skelmersdale also drew attention to Mercury's recent report. My noble friend Lady Seccombe drew attention to the fact that although Mercury was the one licence issued originally, eight new licences have been issued. I am pleased to say that the DTI has received well over 30 applications for new telecommunications licences from companies wishing to take advantage of further liberalisation.
The noble Lord, Lord Holme, asked whether it would not be better for regulators to be automatically answerable to Parliament rather than to departmental Ministers. The regulators are appointed by Ministers with the intention that they will carry out their duties independently of government Ministers. The intention at privatisation was to take the provision of utility services and their regulation as far out of the political arena as possible. The regulators report each year to Ministers on their activities and that report is laid
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before Parliament. The regulators can, through the Public Accounts Committee, be subject to the scrutiny of the House.
We must not forget that the regulators' decisions are also subject to thorough public scrutiny and debate in the press and elsewhere. Such debate keeps the regulators on their toes. Perhaps sometimes they wonder whether there are not other subjects to be debated. The power of public opinion should not be under-estimated.
We attach great importance to transparency and I know that the regulators do too.. They have taken pains to consult and explain their decisions publicly and to encourage public debate. Indeed, Ofgas holds a series of public meetings around the country as part of its review of the British Gas price cap, and all the regulators issue public consultation papers on regulatory issues.
To foster competition, the regulators have insisted that British Telecom and British Gas offer fair terms to their competitors for the use of their networks. That must be a major contribution. Of course, British Gas has given the regulators an undertaking to reduce its share of the contract gas market to less than half its present level by 1995. The evidence shows that under the regulatory regimes the gas and telecoms utilities are delivering major benefits in terms of increased competition, improved quality of service, and price reductions.
Praise has rightly been given to the strongly pro-competitive policies of Sir Bryan Carsberg. I am sure that those will be maintained by his successor. I cannot speak for Sir Bryan's successor, and indeed no decision about the successor has been made, but Sir Bryan's approach was based on his statutory responsibilities to promote competition and to protect consumers. His successor will have the same responsibilities and we would fully expect him to maintain a similar pro-competitive approach.
Anxiety was expressed about increased profitability reported by the water and electricity companies, at a time when the economy as a whole is in recession. Several noble Lords pointed out the need for investment to improve services, to stimulate competition, and to be able to examine in greater detail some of the issues raised by the noble Lord, Lord Clinton-Davis, to which I shall come later.
Regional electricity company profits and price rises were higher last year, but these were not simply the result of excessive price rises or lack of control by the regulator. The regulator has explained that he allowed price rises above the cap in 1991–92 to offset low increases in 1990–91, when inflation forecasts, which are used to set annual price increases, were well below outturn inflation levels and cost increases. Profits accordingly rose quickly last year compared to the year before. This year price increases will be much lower—around 2 per cent. on average—and I was pleased to see that South Wales Electricity was able to announce a price cut.
Perhaps I may quote from the report of the South Western Electricity Board which reported yesterday. The chairman was able to say that the excellent results came from a combination of cost-cutting, better

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management of assets and higher sales. That is what we should like to see from companies. Nevertheless, as has been said, marked year to year fluctuations in prices are not desirable and I know that the regulators have technical aspects of the price cap formulae under review to see whether improvements can be made.
I believe it would be a mistake to introduce more frequent price reviews in response to the higher profit levels this year. It would be based on a misunderstanding of the reasons for those profits. It would take away the incentive for companies to invest for efficiency improvements if the potential profit was quickly passed on to customers in lower prices. We must make sure that those industries provide efficient services.
My noble friend Lord Skelmersdale and the noble Lord, Lord Holme, asked whether there is a case for some privatised utilities to be looked at with regard to rate of return criteria. When the Government decided to adopt a cap on prices to final customers as the means of regulation, it was with the benefit of experience gained by other countries where rate of return regulation had been common, particularly in the United States.
While rate of return regulation may keep profits down, its drawback is that it provides no incentive to the utility to keep down costs and prices. It can also lead to expensive, intrusive and bureaucratic regulation of company investment: something which I am sure all noble Lords agree should be avoided.
Regulation by direct price controls can provide incentives for companies to invest to increase efficiency, by allowing them to share the benefits. There is also the opportunity to reduce prices in real terms for consumers when the price cap is reviewed every few years. Noble Lords will be interested to hear that regulators in other countries, including the USA, are now turning to price cap regulation as a result of our experience. That said, I am sure that the regulators do have regard for rates of return when setting new price caps; indeed, the Water Act requires the regulator to act to help secure reasonable rates of return on capital for water undertakers.
It was not unexpected that reference was made to the salaries of the chief executives of private utilities. They are private companies and the salaries are primarily a matter for the shareholders, and certainly not directly for government. The Government recognise that those salaries are not out of line with those of other big private sector companies. However, they expect top executives to exercise leadership and show restraint over pay, and lain Vallance's 3 per cent. rise this year is a very welcome lead which I hope will be followed. I am sure your Lordships will agree that that is a trend which we should all like to see.
As I say, many points were raised and I shall quickly try to mention a few of them. My noble friend Lord Skelmersdale suggested that the three regulators for the water industry were not necessarily always pulling the same way. They have different responsibilities and objectives, which is why the Government believe that the interests of the environment, customers and the water industry would be best served by keeping the responsibilities separate. However, they are all conscious of the environmental
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improvements that must be paid for by the industry and eventually by the customers. My noble friend Lord Skelmersdale drew attention to the high standards we achieve in sewage management.
The noble Lord, Lord Holme, referred to the accountability of regulators. The regulators operate within a statutory framework and their decisions can be subject to judicial review.
My noble friend Lady Seccombe drew attention to the investment necessary to achieve improvement and also to the fact that there are welcome examples of best practice which may be copied. I doubt that my noble friend realised, when propounding the advantages of wider share ownership which privatisation has brought, that she was directly speaking to Members of your Lordships' House.
I agree with the noble Lord, Lord Hampton, that water meters, and the benefits they bring, should be easily accessible without the handicaps he mentioned. I am sure that is a matter which will be taken on board. Once again my noble friend Lord Lindsay shared his considerable experience of the energy industry, expressing recognition of the need for an investment programme and for energy conservation. Much work is being carried out in the Department of the Environment on those issues.
The noble Lord, Lord Clinton-Davis, raised the question of deposits, disconnections and low income families. I should like to conclude by dealing with some of those issues. It is right that companies should be able to charge deposits where there is a significant threat of the customer defaulting on payment. But the regulators are concerned to ensure that that is done in a fair way. The Competition and Service (Utilities) Act brings all regulators' powers up to the level of the strongest on the matter of determining disputes over deposits and on the provision of supply. There is a recognition of the need for work in that area. British Telecom has already changed its deposits policy in agreement with the Director General of Telecommunications. I am pleased also that that organisation has special arrangements for the disabled.
We heard of the number of disconnections. It is something about which the regulators are concerned, but the numbers have substantially reduced in recent years. The Government believe that those who can pay should do so. That view is shared by the regulators. The water companies drew up codes of practice setting out the procedures to be followed where a customer falls into debt. That provides that customers will, in virtually every case, only be disconnected when they fail to comply.
Lord Clinton-Davis: My Lords, I am obliged to the noble Baroness for giving way. In fact, disconnections have increased. I cited figures from two specific industries. That is why it is giving rise to anxiety. Either the regulators have not done their job properly or do not possess the powers.
Baroness Denton of Wakefield: My Lords, I was quoting other industries. As I said earlier, there is now good practice for others to follow. There is also a constant communication between regulators and a

845
strong awareness on the part of the Government in regard to the issues. Some companies carry out extremely few disconnections; other companies seem to have a less concerned involvement with their customers. It is on the latter that we should focus and I can assure the noble Lord that we shall do so. Discussions are already under way.
I assure the noble Lord that the regulators are taking steps to reduce the level of disconnections in all industries. The general approach is that disconnections should be limited to those who will not pay. Were we to extend it to those people on low incomes who, as a matter of pride, do pay and abide by their commitments, they would be the ones to suffer in the long term.
The noble Lord asked about definitions of low income users and whether we should be looking at that. It would not be practicable or appropriate to levy different charges according to consumer incomes. The social security system exists to provide support for those who need it. Again, all regulators have a duty to ensure that services are provided to all who require them. To that end the regulators ensure that residential prices remain at a fair level. I am not being complacent about the issue. The suggestion of a conference will be drawn to the attention of the parties concerned and that possibility will be examined. What is extremely important at this stage is that the regulators are talking to each other.
Any points that I have not covered I will examine and write to noble Lords as I do not wish to leave insufficient time for the noble Lord, Lord Ezra, to sum up. I simply repeat that the Government are not complacent. I accept that the anxieties raised this evening are genuine and serious. We shall continue to watch carefully the operations of the utilities and their regulators and the progress towards a more competitive market.
Lord Ezra: My Lords, I thank the noble Baroness, Lady Denton, for the comprehensive way in which she commented on the many points raised in the debate and I thank noble Lords for participating.
It has been a reflective debate. The purpose has not been to criticise either the enterprises or the regulators, both of whom have done a good job. However, we are in a new phase of economic development and a number of issues have arisen. There is the question of how far competition is to be further extended; the complexity of the pricing formulae; the representation of consumers; the treatment of consumers on low incomes and of the disabled. All those issues were raised.
It is accepted on all sides of the House that they are issues needing still further consideration. I hope therefore that we shall be able to return to the matter at regular intervals. In the meantime, I beg leave to withdraw the Motion standing in my name.
Motion for Papers, by leave, withdrawn.

Civil Rights (Disabled Persons) Bill [H.L.]
8.8 p.m.
Baroness Lockwood: My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.
Moved, That the House do now resolve itself into Committee.—(Baroness Lockwood.)
On Question, Motion agreed to.
House in Committee accordingly.
[The DEPUTY CHAIRMAN OF COMMITTEES (The Viscount of Oxfuird) in the Chair.]
Clause 1 [Interpretation]:
Baroness Lockwood Baroness Lockwood moved Amendment No. 1:
Page 2, line 26, leave out ("reasonable") and insert ("justifiable").
The noble Baroness said: As with all the amendments before the Committee this evening, Amendment No. 1 is a tidying-up amendment. It brings the Bill into line with the race and sex discrimination legislation which already operates in this country.
A number of references to the need for the amendment have already been made both in your Lordships' House and going back to 31st January 1992, when the Minister in another place, Mr. Nicholas Scott, suggested that,
"the requirement on an alleged discriminator to show that a requirement is reasonable is a less stringent test than that which exists in the sex and race discrimination legislation, where it must be shown to be justifiable".—(0fficial Report, Commons, 31/1/92; col. 1253.)
Amendment No. 1 introduces that higher test of "justifiable". The alleged discriminator will have to show under the amended clause that a requirement is justifiable and not just reasonable. There is a considerable amount of case law which indicates that a reasonable interpretation of "justifiable" has been made by the courts. I beg to move.
Lord Campbell of Alloway: I support the amendment. As the noble Baroness has said, it certainly reflects the case law position and there is no reason for a lesser test than the accepted test of "justifiable".
Lord Auckland: As my name is down on the list, I rise to support the amendment. Another point to be made is that in so much legislation "reasonable" appears as a rather ineffective word. I believe "justifiable" puts the onus on the organisation concerned to make the thing work. The adjective "justifiable" strengthens the Bill in that it gives some incentive to make the proposal work and therefore is well worthy of support.
The Parliamentary Under-Secretary of State, Department of Social Security (Lord Henley): I rise to say that I do not intend to intervene tonight on any of the amendments. I did say at an earlier stage that we did not feel the Bill was necessary, but we made it clear that we were not unsympathetic to the ideas behind it. I also accept that on an earlier Bill my right honourable friend the Minister of State responsible

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for the disabled pointed in another place to the need for some amendment. That was one of the suggestions he made at Second Reading. However, having made it clear that we cannot offer our support to the Bill and that this is not merely a question of drafting, I do not think it would serve any particular purpose if I spoke to each amendment. Doing so might imply that we felt that the Bill could be made acceptable to us by amendment. Nevertheless, I have no intention of opposing this or any other amendment moved tonight.
Lord Rochester: It may seem a little superfluous for me to speak in view of what the Minister has just said, but from these Benches I would nevertheless like to offer my support to the amendment. It seems to me that now the House has accepted the principle that there should be legislation to curb discrimination against disabled people it is important that loose ends should be tied up and that, where possible, as the noble Baroness has said, legislation on these lines should coincide as far as possible with similar Bills on race and sex discrimination. That is the purpose of the amendment and in passing it the Committee will ensure that if and when the Bill goes before another place it has a better chance of being accepted.
Lord Rix: I rise to support this and all the other amendments and indeed the passage of the Bill, which I hope will receive some support from the Government in due course.
Perhaps I may ask a question supplementary to a Written Question put to the noble Lord, Lord Henley. A short time ago I asked for an estimate of the costs of implementing the provisions of the Civil Rights (Disabled Persons) Bill. I received a very courteous response but it was made clear that the department considered that there were considerable costs arising from the obligations imposed on providers of services and public buildings as well as on employers in addition to the costs of a disablement commission. I cannot help wondering whether it is those costs which ensure that the Government maintain a benevolent neutrality in this matter and cannot support the Bill.
Baroness Lockwood: I thank the Minister for his intervention and I understand what he has said. I also thank other noble Lords for the support they have given to the amendment. I beg to move.
On Question, amendment agreed to.
Clause 1, as amended, agreed to.
Clauses 2 and 3 agreed to.
8.15 p.m.
Clause 4 [Medical examinations]:
Baroness Lockwood Baroness Lockwood moved Amendment No. 2:
Page 4, line 29, leave out ("employee") and insert ("applicant").
The noble Baroness said: I beg to move Amendment No. 2. The amendment is designed merely to correct a drafting error. The clause should read "applicant" and not "employee".
Lord Campbell of Alloway: I am a little worried about the amendment. Although as proposed the insertion of the word "applicant" marries with
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"applicant" in line 6 on page 4, does one wish to excise the employee totally from this? Ought not the amendment to read "applicant for employment" or "an employee"? I do not see why it should not be so. In its present form I would not be prepared to support the amendment without further explanation.
Baroness Lockwood: An applicant could be an employee applying for a different post. As the noble Lord understands, the whole tenor of the clause is to ensure that the imposition of a medical examination is concerned with job-related functions and not just medical examinations per se. I was happy that this particular amendment should relate to an applicant rather than employee but I will certainly have a look at it. Perhaps I may have a word with the noble Lord later. I beg to move.
On Question, amendment agreed to.
Clause 4, as amended, agreed to.
Clauses 5 to 9 agreed to.
Baroness Lockwood Baroness Lockwood moved Amendment No. 3:
Before Clause 10, insert the following new clause:
("Enforcement of Part II
.—(1) A complaint by any person ("the complainant") that another person ("the respondent") has committed an act of discrimination against the complainant which is unlawful by virtue of Part II may be presented to an industrial tribunal.
(2) Where an industrial tribunal finds that a complaint presented to it under subsection (l) above is well founded the tribunal shall make such of the following orders as it considers just and equitable—

(a) an order declaring the rights of the complainant and the respondent in relation to the act to which the complaint relates;

(b) an order requiring the respondent to pay to the complainant compensation of an amount corresponding to any damages he could have been ordered by a county court or by a sheriff court to pay to the complainant if the complaint had fallen to be dealt with under section 10;

(c) an order that the respondent take within a specified period action appearing to the tribunal to be practicable and necessary for the purpose of obviating or reducing the adverse effect on the complainant of any act of discrimination to which the complaint relates.

(3) An order made by an industrial tribunal under subsection (2) (a), (b) or (c) shall, for the purposes of enforcement proceedings, be treated in all respects as a judgment of a county court and shall be enforceable as such in all respects.").
The noble Baroness said: I beg to move Amendment No. 3. This amendment is rather different from the others, in that it inserts a new clause. It is an amendment which was anticipated by a number of noble Lords during an earlier stage of the Bill. New subsections 10(1) and (2) would make industrial tribunals the forum in which unjustifiable discrimination in employment matters would be adjudicated upon. Again, the amendment would bring the Bill into line with race and sex discrimination legislation. Indeed, subsection 10(1) is derived from Section 63(1) of the Sex Discrimination Act.
Subsection (2) is also derived from Section 65(1) of the Sex Discrimination Act, but it strengthens the provision. There are two differences here. The first is that subsection (2) (c) gives the industrial tribunal the power to make an order rather than a recommendation which is the position under both the sex and the

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race discrimination legislation at present. Under this legislation the stage of an order is reached only following non-compliance with the industrial tribunal's recommendation. This amendment would make it immediately applicable.
Secondly, the words "and necessary" have been added to clarify the role of the tribunal. Given that we are suggesting that the tribunal should have power to make an order rather than just a recommendation at the stage of adjudication, it seems right that such an order should be restricted to actions which are not only particular but also necessary. Therefore the amendment would have that effect. Subsection (3) is different in that it is new. Again, it is based on the experience of the Equal Opportunities Commission and was put forward by that body in its attempt to strengthen the Sex Discrimination Act. Where there is a refusal, failure or delay by a respondent to pay the compensation awarded by the tribunal, the procedures for enforcement necessitate fresh proceedings to be brought in the county court. It is a cumbersome procedure and in my view it needs to be strengthened and simplified. That is what this amendment seeks to do. I beg to move.
Lord Campbell of Alloway: There are serious objections to this amendment. It seeks to amend a series of statutes and in particular the statute which confers jurisdiction on the industrial tribunal. That is not the only serious objection. It affects the statute which confers jurisdiction on the county court and the equal opportunities and discrimination legislation. I suggest to the noble Baroness that it is wholly inappropriate to seek to bring these changes about in this way.
Lord Rochester: At Second Reading I said that I was delighted that the noble Baroness, Lady Lockwood, proposed to move an amendment of this kind. I took that view simply because the noble Viscount, Lord Ullswater—whom I am glad to see in his place—well knows that in the employment field the normal practice is for appellants to go before an industrial tribunal in the first instance rather than a court. The noble Baroness, Lady Lockwood, has been as good as her word and I am glad to support her. I am far from being as expert in industrial law as the noble Lord, Lord Campbell of Alloway. It may well be that in this complex field there are deficiencies in this amendment. Even if there are deficiencies I suggest that they should not influence our attitude unduly for it is the underlying principle that we are now debating at Committee stage. If the amendment is defective in any way that can be remedied at a later stage. It may be that the noble Baroness will again wish to talk with people like the noble Lord, Lord Campbell, if the need arises before the next stage. Meanwhile, I very much hope that the underlying principle will be accepted this evening by the Committee.
Baroness Lockwood: I am sorry that I did not know that the noble Lord, Lord Campbell of Alloway, planned to raise this point otherwise I would have been very happy to have discussed it with him. I
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recognise that there are perhaps some doubts as to whether the amendment should go as far as it does as regards the county court. At Second Reading I raised the matter as did the noble Lord, Lord Rochester. It had also been raised on an earlier occasion. I believe that it was pretty clear that we would seek to bring in the industrial tribunal to deal with the employment question. I hope that that is a principle that the Committee will accept. That being so, I hope that the amendment will be accepted this evening. However, I shall be happy to discuss with the noble Lord any possible consequential amendment that he might suggest.
On Question, amendment agreed to.
Clause 10 [Proceedings]:
Baroness Lockwood Baroness Lockwood moved Amendment No. 4:
Page 6, line 14, leave out ("Parts II or") and insert ("Part").
The noble Baroness said: In a way this amendment is consequential on the previous amendment which was to introduce the industrial tribunal for employment matters instead of the county court. That means that employment matters will be dealt with through one forum and goods, facilities and services will be dealt with through another; namely, the forum of the county court. The first amendment is therefore consequential. The second clarifies the existing subsection (2) as printed in the Bill at the present time. It makes clear that the county court can grant the same remedies as are available in the High Court, but with certain exceptions. I beg to move.
On Question, amendment agreed to.
Baroness Lockwood Baroness Lockwood moved Amendment No. 5:
Page 6, line 21, at end insert:
(" ; but all such remedies shall be obtainable in such proceedings as, apart from this subsection, would be obtainable in the High Court or the Court of Session, as the case may be.").
The noble Baroness said: I apologise to the Committee. In moving Amendment No. 4 I should have said that I was also speaking to Amendment No. 5. I beg to move.
On Question, amendment agreed to.
Clause 10, as amended, agreed to.
Clause 11 agreed to.
Baroness Lockwood Baroness Lockwood moved Amendment No. 6:
After Clause 11, insert the following new clause:
("Application to Crown etc
. This Act applies—

(a) to an act done by or for the purposes of a Minister of the Crown or government department; or

(b) to an act done on behalf of the Crown by a statutory body, or a person holding a statutory office,

as it applies to an act done by a private person or body.").
The noble Baroness said: Again, this is a new clause. It will bring the Bill into line with similar anti-discrimination legislation on the part of the Race Relations Act and the Sex Discrimination Act. The amendment seeks to apply that legislation to acts that are done by or on behalf of the Crown. There is a slight addition to the provisions that exist in the sex discrimination legislation in that our amendment adds the words "or … a statutory body". The phrase

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"statutory body" has been included to reflect the importance of discrimination by bodies other than private persons. I beg to move.
On Question, amendment agreed to.
Clause 12 agreed to.
Schedule agreed to.
House resumed: Bill reported with amendments.

Yugoslav Refugees
8.31 p.m.
Lord Hylton Lord Hylton rose to ask Her Majesty's Government what arrangements are being made throughout Europe for refugees who have already left the former Yugoslavia and what relief and aid they and others are providing to displaced people within that area.
The noble Lord said: My Lords, I rise with some diffidence to ask this Question and to open our short debate. I say that because I personally have never visited the former Yugoslavia, whereas some of your Lordships are no doubt closely acquainted with that part of the world. We are faced, however, with urgent humanitarian issues and I am glad that the recent Starred Question that was tabled by the noble Lord, Lord Campbell of Croy, drew attention to them. The noble Lord has told me that he regrets that he is unable to be here tonight. I regret it also and perhaps I may add that I am just a little amazed that it appears that there has not been a full-scale debate in this House on the whole problematic situation in the former Yugoslavia since trouble began there last summer.
On 21st May this year the English press quoted Pope John Paul II speaking of:
"A terrifying drama, such as Europe has not seen since the end of the Second World War".
He urged
"People of goodwill to help those suffering because of the iniquitous fratricidal war that is bloodying Bosnia-Herzegovina".
We know that there have been heavy casualties, largely among the civilian population. They have included observers and aid workers of the United Nations, the European Community and the International Red Cross, some of whom have been killed and wounded. On 2nd June the office of the UN High Commissioner for Refugees, acting jointly with UNICEF and the World Health Organisation, issued an emergency report. This followed the temporary forced withdrawal of the UNHCR and International Red Cross personnel from Bosnia and Herzegovina. The report stated that 1.5 million people have been obliged to flee their homes in former Yugoslavia since June 1991. Of these, nearly a quarter of a million found refuge in other European countries.
The Tablet magazine of 20th June described some very real difficulties. Because camps in Croatia and Slovenia are hopelessly overcrowded, Bosnian and other refugees were arriving in Austria. Some were even coming by train from Greece, which refused to accept fugitives, but gave them rail tickets to Vienna. In Vienna, the Minister of the Interior had made it clear that Austria could not go on admitting refugees. I should add that Austria has in fact been most
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generous, contributing food and medicines to a value of £7.5 million. Germany is reported to be turning back applicants, including even the wives and children of Bosnians living and working in Germany. The situation is said to be similar in Switzerland. I am glad to say that in Britain the situation is a little more encouraging since the Home Office seems to be taking a sympathetic line towards Yugoslays who are unable or afraid to return to their country.
What information do Her Majesty's Government have about refugees from Yugoslavia in the rest of Europe? At what rate are they still arriving? Are they thought to have come mainly for family reunions, and on those grounds, are they expected to remain where they are permanently? Whose responsibility are they —apart, of course, from the host country and the UNHCR? Which European Community institutions have so far considered these problems, and with what result? Do Her Majesty's Government consider that the Council of Europe and the Conference on Security and Co-operation in Europe have a part to play and, if so, how? What co-ordination is being attempted between voluntary bodies in Europe, concerned first with the reception of refugees and secondly with relief and development.
I come now to the much bigger question of those internally displaced within Yugoslavia. The report already quoted showed nearly 1.3 million displaced persons. Of these, over half a million came from Croatia, and the remainder from Bosnia and Herzegovina. Again, at that time over half a million were located in Croatia, while some 363,000 were displaced inside Bosnia and Herzegovina. Serbia had taken in 315,000 and Slovenia, Montenegro and Macedonia accommodated smaller numbers. I think that it is likely that these huge figures have increased somewhat during the month of June. What information do Her Majesty's Government have on that.
It is a sad fact that we have to note the most appalling violations of human rights. Fighting has been conducted with complete disregard for the Geneva conventions. Agreed truces have been broken time and again. Civilians and non-combatants have been put to hard, unpaid labour, beaten, tortured and murdered, while their houses were looted and destroyed. Abuses extend outside the immediate zone of fighting to areas such as Kosovo and Vojvodina.
I am indebted to the report of the British Section of the International Society for Human Rights, dated 29th May 1992, following the return of its observers from Croatia and Bosnia-Herzegovina. The document carefully details several dozen incidents between mid-March and late May, where the minority inhabitants of Serb-controlled towns and villages were forced out, sometimes to be replaced by displaced Serbs from elsewhere. The victims varied in number from two or three people, up to groups of several thousand. There appears to have been a deliberate policy of creating ethnically pure areas. All minorities have suffered—not just the Croats and the Moslems. Soldiers in the Yugoslav National Army and the Serbian militias have enforced that policy. During

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April and May of this year, there also appear to have been consistent attacks by Serb military units on relief workers and aid convoys.
Does the information available to Her Majesty's Government confirm what I have just been saying, and have there been similar abuses on the Croatian side? In this context, can the noble Baroness comment on the significance of "pink areas"? I understand these to be parts of Croatia with Serbian populations, adjoining but immediately outside the United Nations protected areas. Will the Government and their allies make common cause to ensure that the resources and instructions of the UN peace-keeping forces are such that ethnic purging ceases immediately, at least within the UN protected areas, but if possible everywhere? Will the Government go further and seek the sending of UN observers to Kosovo and Vojvodina, where the human and civil rights of the majority, in the one case, and of the minority in the other, are in doubt.
It is certain that the immediate situation of the displaced people is most difficult. Croatia and Slovenia are at saturation point and the same may be true of Serbia. Tented camps may well be needed. Those, of course, will require special public health measures to prevent epidemics, and will offer no real solution for the coming winter. What can be done to provide prefabricated houses.
The UNHCR reports that the vast majority of those fleeing from Bosnia were women and children. UNICEF reckoned that 200,000 children under the age of six needed special foods and medical help. Co-ordination and team work between the UN agencies has been good. The UNHCR, UNICEF and WHO made a joint appeal for funds for 1992 totalling more than 174 million dollars. By the end of May contributions had been made or pledged in excess of 32 million dollars, with further help in kind. Can the Government say whether there has been progress since then.
Some imaginative work is already in hand. In March, UNICEF launched a programme to make children aware of the dangers they face from mines and other explosives. A framework for psycho-social rehabilitation for war-scarred children is under way. Traumatic stress also affects adults. Their needs and training requirements are being assessed. WHO is organising medical help through a network of European and Yugoslav cities.
I hope that I have indicated something of the urgent difficulties facing both refugees from the former Yugoslavia and those internally displaced inside that country. Well-organised and well-funded help is needed now. Many areas and groups can be reached, even if fully adequate relief is not yet possible for the battered inhabitants of Sarajevo and Dubrovnik. As regards Sarajevo, I should emphasise the importance of supply by road. It has been estimated that the city needs 190 tonnes of food per day, and it is difficult to supply that much by air transport.
There is a real challenge, first to Europe, and then to the rest of the world and perhaps especially to Serbs and Croats living in other parts of the world. Because of the size of the challenge, I particularly welcome the
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visit which Mrs. Ogata of the UNHCR, will be making to the whole area between 6th and 9th July. I invite later speakers and the noble Baroness the Minister to give us their thoughts on the longer-term needs for resettlement, reconstruction and the rebuilding of shattered systems of education. The aim must surely be to enable the maximum number of displaced people to return to their ancestral homes. Such an aim will, no doubt, have to be tempered with realism. In some cases, there may be scope for voluntary and agreed exchanges of population, as happened between Turkey and Greece in the 1920s.
Both in the short term and looking further ahead, I believe that there is great scope for the expertise and compassion that is available in these islands. The surgical and other skills of Northern Ireland could be most useful. British knowledge of the rehabilitation of refugees and torture victims has a part to play. British military forces, acting in conjunction with the Western European Union and NATO, may play a constructive part in coming to the aid of the civil authorities. In this context, I welcome the presence in Croatia of our Army medical unit.
Our administrative abilities and wide range of specialised voluntary bodies have seldom been more needed. I trust that we shall all rise to the occasion. Above all, the international community has a duty to ensure that the conflicts that have raged since the summer of 1991 are the last to afflict the Balkans in the present era.
I mentioned earlier the possibility of sending UN observers to areas as yet unmarred by fighting. I should like to see that idea expanded by the creation of a multi-disciplinary listening and conciliation service. Such a body would listen to ethnic, religious and minority problems, before they erupt into physical violence. I trust that it would help to defuse some explosions before they occurred.
I look forward to hearing the Minister's reply and take this opportunity to thank all those contributing to our debate.
8.46 p.m.
Lord Wedgwood: My Lords, as the noble Lord, Lord Hylton, pointed out, the situation in the Balkans remains extremely serious, despite the hopeful signals received from Sarajevo this week. Based on the actual figures of displaced persons and refugees in what was formerly Yugoslavia, it is possible that some 1.5 million will not be able to return to their native ancestral homes. With this and further ethnic cleansing, the former republic's neighbours are faced with the colossal task of receiving enormous numbers of distressed victims of the warring factions.
It is inevitable that the spill-over will take place into countries beyond those neighbours, as the noble Lord, Lord Hylton, pointed out, affecting all of us in Europe. As Britain is assuming the European presidency, is it not time for this country to show the type of leadership for which we have an outstanding reputation in the international arena, or will we reduce the proud and majestic British lion, who stands tall among the stars of Europe, to some clawless tame

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animal? Are we a nation that has finally succumbed to symbolism, or can we still act on the realities of leadership, with all the choices and risks involved.
With this ever enlarging situation in the Balkans, one can only hope that with the assumption of the European presidency, the Government will react to all of this by first creating reasonable foreign policy objectives to avert the suffering and to bring stability. One reasonable foreign policy objective must be to force the warring parties to let all the refugees return to their natural and rightful homes. An attempt to achieve this objective presents considerable dangers. History and experience will show that those dangers could go beyond the internal boundaries of the former Yugoslavia. The stability of its neighbours and those beyond must certainly come into question. The duration of any involvement must also be a primary concern. We certainly do not need to recreate the problems of Northern Ireland and the extent of the emergency within the Province.
Taking into consideration these two vital elements, there are a number of choices available for intervention at this time. These choices vary considerably, but I believe lead us to an inevitable conclusion. The first would be to send a preventive force into Macedonia. This would come in conjunction with the international recognition of Macedonia as a separate state.
The objective would be as a deterrent to any foreign or Serbian intervention. That of course deals with only a fraction of the overall problem. It may save the Macedonians but could further ignite problems elsewhere. A second option would be to increase United Nations forces in the four protective areas within Croatia. It is my understanding that the capabilities of the mixed assortment of troops deployed for that task have been the subject of much criticism. It seems that we are courting disaster in deploying a peacekeeping force without the ability to retaliate and with insufficient professionalism.
Those forces need the support of professional infantry. Although other countries in Europe have elements of well-trained infantry, it is the British infantry that is the best trained and most experienced for such an operation, with the right equipment. An infusion of a professional fighting force would set an example to other United Nations participants and provide the necessary deterrent to the warring parties, thus preventing further ethnic clearance.
Another option relates to the United Nations sanctions policy. For those who favour that policy, it must be apparent that the United Nations resolution that all member states should police the policy is somewhat naive. A member state in Africa, for example, could commit itself to that policy and ban all shipments from its ports. However, what happens between those ports and the port of Bar is another matter. The United States is prepared to deploy a naval force in that area, but I question who is policing the port of Bar which is the sole port for the Serbs and Montenegrans. A naval presence is essential to establish the credibility of that policy. There has been speculation about international inspection teams at entry points into Serbia and from Serbia or Croatia
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into Bosnia and Herzegovina. Perhaps those teams could be backed by the threat of an air interdiction. Today we also understand that the United States is prepared to provide air support. There are a couple of relevant issues here. It was comparatively easy to use air power in that manner during the Gulf War. The open nature of the desert lands lends itself to that, but destruction of entry routes and bridges in the mountains of Bosnia is a different matter.
A history of inter-racial struggles has created a nation of hoarders who will use the terrain and their own ingenuity to make the task impossible for inspection teams. Article 42 of the United Nations charter provides the opportunity for the use of force in a demonstration role, using air, sea or land forces. If we selected a target, such as the air base outside Belgrade (Batinica), we could mount a strike to ground part of the air force without excessive, or any, casualties, bringing home to the Serb peoples the international community's determination to arrest disorder in the Balkans before it spreads further.
The debate addresses a serious humanitarian problem for which the only solution appears to be one of intervention. The international community has identified Sarajevo as the prime example of where a safe haven can be created. Expert military strategists who have studied that area will explain the complexities of the terrain. It is possible that with some extra support the Canadian forces now being deployed in Sarajevo could secure the immediate area of the airport.
With modern weaponry, using automatic weapons with a range of up to 1,800 metres, and positioning troops with given fields of fire, that force, which would represent roughly an infantry battalion, could cover a radius of 3,000 metres, the approximate area of the airport.
Two problems present themselves immediately as we might discover in respect of the Hercules now on its way to Sarajevo. An airlift of supplies can arrive at the airport, but who will ensure their satisfactory transport on into Sarajevo? Several infantry battalions should be involved in that task, especially when one considers the two areas adjacent to the airport (Dobrinja and Ilidza) which are held by warring factions and pose a threat to any safe passage.
Secondly, as Sarajevo is surrounded by high ground of a radius of approximately 30,000 metres it would be necessary to deploy a further 10 infantry battalions onto that ground, using the equation of one battalion for every 3,000 metre radius. Finally, to remove the threat of indirect weapons, (mortars and artillery) it would be necessary to dominate that high ground with forward observation officers and a combination of sound-ranging equipment, mortar-locating radar and other devices, together with forward air controllers to direct ground attack aircraft accurately, should that become necessary. To include the active patrolling of a demilitarised zone of some 20 kilometres, a total task force of about 30,000 troops would be required.
Experts from the Royal Institute of International Affairs agree that it would take from at least six months to one year for sanctions to bite. We can

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expect the violence to continue and the suffering to increase. Is it not a reasonable foreign policy objective to support a stand-off in the Balkans? The Government should be commended for their continued support of NATO. Recent events have shown how vital is the Euro-American partnership. It must be maintained. But when will the new British lion of Europe provide the voice of reasoned leadership once more, rather than the timidity of what passes for near appeasement.
The Cold War has disappeared, thanks to the resolve of our NATO allies, and displays of courage like that of the former Prime Minister my noble friend Lady Thatcher who, in the face of a tinpot dictator, deployed our professional troops to maintain international order in the South Atlantic, thereby sending an indirect signal to the Warsaw Pact that we would not stand for aggression in the future. This is not a time for timidity and appeasement, but for courage, resolution and right decisions.
8.57 p.m.
Lord Judd: My Lords, I am sure that, not for the first time, the House is grateful to the noble Lord, Lord Hylton, for raising such an important humanitarian issue in the thoughtful, reflective way in which he did tonight. I am sure that the noble Lord will also agree that if we are paying tributes during such a debate then we want to put on record in this House our appreciation of the valiant work done by the noble Lord, Lord Carrington, in the midst of all the difficulties and, indeed, that of all the personnel of the United Nations and the United Nations Commission for Refugees, and others, who have been working in impossibly difficult circumstances.
The noble Lord called for a wider debate on the issues. This obviously is not the time to have the widest debate but I agree that it is impossible to look at how we should respond to the symptoms without looking at the causes. I hope therefore that the House will forgive me if this evening I dwell a little upon the wider issues at stake.
The international community has been shocked by the speed at which Yugoslavia has disintegrated into a series of warring republics and by the anarchic cycle of violence that appears endless despite numerous United Nations and European Community-sponsored ceasefires and peace initiatives. That has all been a severe test of the political will and cohesion of our increasingly integrated European Community in dealing with political and humanitarian issues on our own doorstep. It is as yet, I believe, far from clear how well we have together passed that test or, indeed, whether we have passed it at all. It has taken the courage and vision of President Mitterrand's brave visit to Sarajevo to achieve a breakthrough, with, I understand, the arrival today of French commandos to help secure the airport. The French have done much to redeem the credibility of the values of effectiveness and compassion we like to proclaim as basic to our European way of life. The task is now to build on the lead which they have given.
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The fighting between Croatia and Serbia which so extensively spilled over into the republic of Bosnia and Herzegovina has put that republic into the grips of a bloody civil war between the Serbs, on the one side, and the Moslems and their Croat allies on the other. The escalating conflict has claimed thousands of lives and contributed markedly to the rising tide of refugees forced to flee the fighting.
For Yugoslavia, the writing was on the wall some years ago with the fighting in Kosovo. There was no shortage of concerned voices predicting trouble. Sadly, this advance warning seems to have been lost on the governments of Europe. It is only since serious conflict began that the European Community has belatedly made numerous efforts to try to prevent the outbreak of total civil war in the former republics of Yugoslavia. Unfortunately, as we have seen, these attempts at mediation, culminating in the general peace conference chaired by the noble Lord, Lord Carrington, on 3rd September 1991 and the deployment of peace monitors came too late and failed to halt the violence. It was the impotence of Europe which led to the increased United Nations activity.
By Resolution 713 on 25th September 1991 the UN Security Council first became involved with the imposition of the general arms embargo and support for the general peace conference under the auspices of the noble Lord, Lord Carrington, the European Community's special representative. Whatever the disappointments and difficulties encountered by the noble Lord in his dedicated efforts, it is to a great extent thanks to his characteristic and indefatigable commitment that the peace conference may yet play a useful role in promoting a negotiated settlement when the different sides eventually decide to negotiate.
The inability of the European Community to secure a ceasefire, first in Croatia and now in Bosnia, was to a large degree because of the determination of the protagonists to continue fighting until such time as their objectives had been achieved. In relation to Serbia, this entails taking control of Serb-dominated areas of Bosnia and Croatia, while the Croats are fighting to assert their influence in Bosnia and Herzegovina in the event of that republic being carved up between the warring factions.
Under the terms of Security Council Resolution 757 on 30th May this year the United Nations has now imposed sanctions on Serbia and Montenegro, which it has blamed for much of the violence. The UN had attributed the fighting in Bosnia and Herzegovina to the aggressive policies of Serbia's president and to his support for the Serbs in Bosnia and Herzegovina. However, a controversial report issued by the UN Secretary General on 1st June this year blamed both the Serbs and the Croats for the violence.
The package of sanctions now includes an extension of the embargo on arms sales, a ban on all sporting links, oil and trade, the freezing of all international assets and the suspension of air links. Medical and humanitarian food supplies have been exempted. The sanctions imposed by UN Resolution 757 were described by the Foreign Secretary on 2nd June as:

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"One of the most comprehensive series of measures ever adopted by the UN".
The immediate goals of UN sanctions are to end the fighting, creating conditions on the ground which will allow the UN to implement its relief programme and to demobilise the Serbian irregulars and other nationalist militias. That will allow the return to their homes of all those displaced about whom we have heard tonight.
It is to be hoped that sanctions and the emergence of such conditions will help to bring an end to the current conflict and allow a negotiated settlement of all outstanding disputes between the former Yugoslavian republics. However, it has to be recognised that there are those who fear that sanctions will simply inflame Serb nationalism and precipitate military action on the part of the United Nations.
It is powerfully argued that UN Resolution 757 has left the door open for United Nations military action to end the fighting. It seems that the United Nations, in the face of recent conflicts such as the Iraqi invasion of Kuwait and the current fighting in Yugoslavia, is moving towards a more interventionist humanitarian phase in its history.
With reference to the crises in the former republics of Yugoslavia, the United Nations Secretary General has indicated that United Nations military intervention could be undertaken if the Security Council members vote for such action. Similarly, the United States Government appear to be in the process of preparing for a US humanitarian relief operation which could well involve the US military. However, I understand that the President of the United States made a strong statement today playing down eagerness to use force. The use of force is also being discussed by the Western European Union.
Against that background, the Prime Minister has reacted cautiously to these developments. In a recent interview for the newspaper, Le Monde, he highlighted the inherent dangers of military intervention and the fear that the intervening force would get sucked into a full-scale war. Nevertheless, the Lisbon summit, even before the surprise Mitterrand initiative, agreed that it was unable to exclude the possibility that a United Nations military operation might be necessary to support a humanitarian relief operation in the event of the conflict continuing unabated and the United Nations agreeing to that course of action.
On 8th June, the Security Council adopted Resolution 758 which empowered the United Nations Secretary General to deploy military observers to Sarajevo to try to organise the withdrawal of heavy military equipment from the city. This resolution also allows the United Nations protection force in Yugoslavia to deliver humanitarian relief supplies to Bosnia and Herzegovina and to secure Sarajevo airport to achieve this end. That is a prospect which we hope has become more realisable in recent days since the Mitterrand mission and the arrival of the French commandos with, I understand, also pilot food distribution now beginning and with further planes on the way.
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According to Resolution 758, the deployment of UN troops to achieve these aims will be contingent upon,
"an effective and durable ceasefire"
in Sarajevo. It would be helpful to hear tonight from the Minister how UN arrangements are progressing in the wake of the French initiatives.
The refugee crisis in Yugoslavia, as we have powerfully heard this evening, is deepening by the day, according to the emergency report issued jointly by the United Nations High Commissioner for Refugees, UNICEF and the World Health Organisation. More than 75 per cent. of those fleeing the fighting in the former Yugoslavian republics are women and children.
The report states that while negotiators are attempting to affect a ceasefire long enough for humanitarian relief operations to be channelled through Sarajevo airport, food shortages and fear of the violence escalating are precipitating the flight of families from areas as yet not directly affected by the fighting. As we have heard, the report indicates that 1.5 million people in the former republics of Yugoslavia have been displaced with nearly 250,000 seeking temporary refuge in neighbouring countries.
UNHCR, UNICEF and the World Health Organisation have emphasised that while the number of victims is growing daily the ability of host communities to help them is declining. The House is, of course, aware that in answer to a Starred Question on relief aid to the former Yugoslavian republics on 10th June 1992 the noble Baroness, Lady Trumpington, stated that since November the UK has given £9.7 million to the Red Cross and the UN humanitarian agencies to help those displaced by the fighting. But a joint appeal by UNHCR, UNICEF and the World Health Organisation issued on 22nd May for 174 million dollars by 30th May drew pledges totalling only 32 million US dollars. It would be helpful to be told tonight the level of funds that that appeal has now reached.
As I have indicated, Resolution 757 arguably leaves the way open for the use of force at a later date. The willingness of those of us on these Benches to support such inevitably hazardous action, with all its dangers and uncertainties, not least for civilians, would depend upon the degree to which the action had been fully discussed, weighed and approved by the UN Security Council. Such action, if deemed necessary, would be fraught with grave potential. It would therefore have to have clear objectives and the full support of the UN as a whole. There must be no question of the United Nations being subcontracted by an unrepresentative few member states, however powerful those states.
The Serbs—not all, for there are many Serbs who are as appalled by events as any of us in this House tonight—must take responsibility for much of the current fighting. However, they are not the only culprits, as the Secretary General's report has emphasised, and any future settlement will depend upon mutual respect and the safeguarding of all minorities. In the meantime we on these Benches

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welcome the implementation of sanctions against Serbia and Montenegro and hope that they will help to bring a speedy end to the current human tragedy.
Arising from the points that have been made tonight, it would be extremely helpful if, when she replies, the Minister would deal with the following questions. What is the Government's assessment of the effectiveness of UN sanctions against Serbia and Montenegro? Can the noble Baroness give an indication of whether the United Nations has set a timetable for sanctions to work? Do the Government agree that UN Resolution 757 leaves the door open for the use of force at some future date? Can the noble Baroness confirm that such action would require the full agreement of the Security Council.
Will the Minister advise the House whether the UN has held recent negotiations with representatives from the different sides in this conflict in an attempt to bring about an end to the fighting? Can the noble Baroness advise the House of the latest position as regards the relief effort in Bosnia-Herzegovina and can she indicate what steps the UN is now taking to ensure that humanitarian and medical supplies reach the civilians who are in desperate need of such supplies? Can the noble Baroness confirm the level of funds which has actually been received to date in response to the joint appeal by UNHCR, UNICEF and WHO on 22nd May to raise money for the relief effort.
Can the Minister advise the House of the Government's latest assessment of the refugee crisis in Bosnia-Herzegovina? Can she also say what funds the Government, the European Community and the UN are providing to assist with the relief of those displaced by the civil war? What is the latest news of the ceasefire? Can the noble Baroness confirm when the current situation in the former republics of Yugoslavia will next be discussed by the United Nations, and specifically by the European Community? I should assure the House that I have given the Minister notice of these questions.
This debate has been timely and important. There are many lessons to be learnt but I believe that, apart from the test of the effectiveness of the European Community, one of the lessons that none of us can ignore is that we are moving into a state of volatility in world affairs in which we can no longer postpone the priority of establishing effective United Nations methods for dealing with crises in time and not waiting until they have overwhelmed us before the world responds.
9.13 p.m.
Baroness Chalker of Wallasey: My Lords, I am grateful to the noble Lord, Lord Hylton, for raising the issue of the arrangements being made for displaced persons from the former Yugoslav republics. It is a question of deep importance and concern to the Government. I am grateful not only to the noble Lord but also to the noble Lord, Lord Judd, and my noble friend Lord Wedgwood for their contributions to this important debate.
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The debate has ranged wide. I shall try to answer at least most of the questions that have been put to me tonight. If I err and leave one out I shall write to the noble Lord thereafter.
The tragedy being played out in the former Yugoslav republics is perhaps the greatest instance of human suffering in Europe since the Second World War. Nearly 2 million people have been forced to leave their homes and take refuge either in safe areas in their own countries or in neighbouring states. Thousands more remain trapped in the conflict zones of Bosnia and Croatia, unable to move out of fear for their own safety. They face critical shortages of food, water and other basic supplies. Those civilians who are caught up in the fighting and those who have been displaced are pawns in a very brutal game. We cannot but deplore the blatant disregard for basic humanitarian principles shown by some of the parties to the conflicts—some more than others but nevertheless blatant disregard from time to time on all sides. Certain of the violations of those principles, such as the murder of the senior Red Cross official or the shelling by Serbian irregulars of civilians in the streets of Sarajevo, simply beggar belief.
The United Nations humanitarian agencies and the International Committee of the Red Cross have done an outstanding job in seeking to provide assistance to the displaced wherever they can. They have worked against the odds to deliver relief in difficult and often dangerous circumstances. They deserve our fullest support. I can assure your Lordships that the British Government will continue to give it. But to be fully effective the agencies must be able to operate in safety. Otherwise they cannot deliver relief to those displaced persons and refugees about whom the noble Lord, Lord Hylton, spoke so sagely at the beginning of the debate. That is why it is crucial that all the parties in the various areas of the conflict heed the calls in the United Nations resolutions, in the Lisbon summit conclusions and in every gathering, for the creation of security conditions which will allow the safe delivery of desperately needed humanitarian relief.
In this debate there has been some criticism of our not having been able to move forward effectively to relieve the terrible conditions in which the people of the former Yugoslav republics are living. In his speech the noble Lord, Lord Judd, having condemned the lack of action, made it quite clear why it had been so difficult to move forward. I can assure your Lordships that we have been ready at every turn to give aid and to put in the support that was needed. However, we should never do so without regard for the people who have to deliver it. We know from the death of six EC monitors as well as the death of the Red Cross worker, and indeed some of the very painful injuries that others have suffered in carrying out their humanitarian work, that we are putting people at very great risk in order to help save the lives of so many innocent people who are caught up in the civil war.
We have been waiting for a ceasefire for a long while. When the European Council adopted its declaration last weekend it was quite clear from all parties that unless there was a continuation of the ceasefire which had been so much hoped for and which

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seems partially to be holding at present, we would not be able to carry out all those aspects of humanitarian support that we wished.
My noble friend Lord Wedgwood suggested that we needed major military might to bring about a successful end to the fighting. At the weekend there was the courageous visit of the President of France, President Mitterrand. That was a risky thing to do. We all praised him for doing it. We believe that it may—and I can only say may—have helped, together with all the other measures that have been taken in the interim, to break down the objections to a ceasefire for the time being.
I must say to my noble friend that we have no evidence of breaches of sanctions. We know that the sanctions regime is working and having an effect. The noble Lord, Lord Judd, asked me about our assessment of those sanctions. I can say to him that they are having a disruptive effect on the Serbian economy. They must now be given time to work. I believe that it is the combination of that and world opinion which is causing the ceasefire to hold, at least in the main, at the present time. There are long petrol queues; in Serbia workers are being sent off early for their summer holidays. There are signs that the sanctions are beginning to work.
Your Lordships will know that in Security Council Resolution 757, paragraph 16, it was decided that the Security Council will:
"keep under continuous review the measures imposed by paras 4 to 9"—
that is, those paragraphs of the resolution detailing the sanctions regime—
"with a view to considering whether such measures might be suspended or terminated following compliance with the requirements of Security Council Resolution 752";
that is to say, stop fighting and co-operate with the efforts of the European Community to bring about a negotiated political solution.
The noble Lord, Lord Judd, also asked me about UN negotiations with representatives of the different sides. There is daily contact between the UNPROFOR representatives and the parties to the conflict at all levels. But there are two roles being played out: the role being carried out very bravely by our noble friend Lord Carrington to try to make the peace; and the role of the United Nations to keep the peace. That is a very difficult thing to do.
We have always realised that sadly there might be need for the use of force. The noble Lord, Lord Judd, was absolutely right to ask about Security Council Resolution 757. Such a resolution leaves the door open for the use of force but any departure to use force, any departure from the current humanitarian work and the work that UNPROFOR is doing, would require a Security Council resolution. It is important always to remember that we can only act within the resolutions so far passed. But we are prepared, if there is no other way to bring peace to those benighted people, to go back to the Security Council.
I do not wish to detain the House too long tonight but it is right that I report that my noble friend Lord Carrington sees the crisis in Bosnia as the most pressing problem of all those facing his conference. He has therefore decided to try to visit Sarajevo on Friday
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next, 3rd July, in an attempt to restart the talks with the parties concerned on future constitutional arrangements for Bosnia-Herzegovina. However, there are a number of other important areas which the noble Lord, Lord Carrington, and his conference are actively addressing. I refer to the issues raised by the noble Lord, Lord Hylton, the human rights issues affecting Serbs in Croatia, Albanians in Kosovo and Macedonia, and Hungarians and others in Vojvodina.
The conference is also tackling the more practical issues of succession, such as the question of the division of assets and liabilities of the former Yugoslav republics. There is a great deal of work to do. I know that this House wishes my noble friend Lord Carrington every success in the enormous task that he has undertaken.
The latest position in Bosnia-Herzegovina is that the ICRC has been re-established in the Bosnian towns; and in Sarajevo so far there have been five French relief flights. Sadly most of them have had to sit on the runway not unloaded because there is a need for the very equipment which the UK is airlifting into Sarajevo—the kind of trucks and vehicles which will take the goods, generously given, from Sarajevo airport into Sarajevo and out beyond. But even they cannot move unless they can be protected by the UN forces. I shall return to that point in just one moment because the Canadian troops who are going in will be part of that whole operation.
Perhaps I may now turn to the whole question of helping people in that situation. We are sending logisticians to help UNHCR to take forward the deliveries of the goods when it is safe to do so. But the whole plan has to be carried through in a military, but a peaceful military way. I am sure that my noble friend Lord Wedgwood would want to use whatever staff is needed to carry that through. Of course, there has already been superb work done by our own people who serve there with UN forces from the Ambulance Corps.
Perhaps I may turn to the question of refugees and displaced persons. The international relief effort is obviously led by the ICRC, UNHCR, supported by UNICEF and WHO. ICRC provides relief in the conflict zones. It is working to promote compliance with the Geneva Conventions. It has gone on supplying in Bosnia and Herzegovina food and hygienic supplies to displaced and vulnerable groups —for example, hospitals, orphanages and old people's homes. UNHCR, UNICEF and WHO are providing the relief supplies to the refugees and those displaced throughout the former Yugoslav republics. Regrettably there have been the appalling security risks of which I spoke earlier.
I have been asked several times about the international appeals that have been launched to support the activities. For ICRC the appeal was for the equivalent of £15.6 million sterling and for UNHCR £92 million sterling. So far some 53 per cent. of the former and 29 per cent. of the latter has been pledged by the international community. That is not enough. We are doing our bit. We are encouraging others to do theirs. I understand that by using local non-governmental organisations, which always do so

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well in these situations, UNHCR is able to deliver help in a number of areas which have previously been very difficult to reach. Certainly a number of European NGOs have been used by the Commission for delivery of EC-donated supplies—agencies such as CARITAS, Pharmaciens Sans Frontières, Equilibre, the Children's Embassy and a number of others. But there are many people willing to help if only a ceasefire will permit them to do so.
The great majority of the people displaced by the conflicts are indeed in neighbouring republics. We have already heard much about what is going on from the noble Lord, Lord Hylton. We know now that nearly 1.5 million refugees have been registered by the UNHCR from the former Yugoslav republics including displaced persons. But there are at least another 325,000 people seeking sanctuary in countries outside the former Yugoslavia. The UNHCR continues to monitor the situation closely. It has registered some 200,000 in Germany, a further 60,000 in Hungary and some 20,000 in Austria. Those figures represent only those who have registered. The true scale of the problem is far greater and almost impossible to quantify exactly although efforts are being made. Many thousands have sought shelter with friends and relatives. They have not registered. We know that the Austrian authorities estimate that they have more than 40,000 Yugoslav refugees within their borders—more than double the figure that I quoted for those registered with UNHCR.
Those seeking sanctuary are the joint responsibility of both the country of refuge and the UNHCR under the terms of the 1951 UN Convention on the Status of Refugees. The UNHCR is doing its best. Everyone else is prepared to back it. But we shall only see an end to the refugee and displaced persons' problem when the fighting stops altogether.
Having told your Lordships of the latest assessment of what is going on, I can only say that the latest news on the ceasefire is better than it has been. We believe that the re-opening of the airport will pave the way for agreements to allow the safe passage of relief goods by road. That is the most cost-effective way of transporting the huge quantities of goods that are required.
The Canadian battalion which is going in to help will arrive in two stages. It will be taking goods with it. I understand that there is an advance party of 250 going in tonight, and a further body of about 550 tomorrow night. Those troops are the ones who will secure the airport for the humanitarian flights until a durable ceasefire has been achieved. It is crucial that all the parties to the conflict agree to abide by the ceasefire. We can then really get to work to help the refugees, the displaced persons and those people who are barely surviving in their own homes. They must not be forgotten.
The work that we are doing—whether it be with the help of the 60 UN military observers who arrived on 17th June at Sarajevo Airport, whether it be through French, Canadian and other troops or our own ambulance personnel and engineers who are serving —is to one end; namely, to bring relief to the people
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of the former Yugoslav republics. The conditions in Bosnia-Herzegovina are quite terrible. We know about all the shortages; they need not be repeated now.
I believe that we need to carry on with our work to find a durable political solution and to undertake preventive work where that is sensible. I know how much my noble friend Lord Wedgwood is concerned about that. We cannot undertake that work on the scale that he outlined. It is important that in carrying out preventive work we do not interfere with groups which can manage for themselves, perhaps with some technical assistance from outside. However, those who are involved closely—whether it be in Kosovo, Vojvodina or anywhere else—tell us that it is important that on the ground we have the monitoring of the observance of the CSCE commitments. That is why the senior officials from the CSCE went to Vojvodina, Sandjak and Kosovo. Sadly, we have not been able to secure the co-operation of the Serbian authorities in those visits. However, we shall continue to try until those tasks can be made to work.
The noble Lord, Lord Hylton, asked about asylum applications from the former Yugoslav citizens. We have received some 1,000 applications in this country. All applications are considered under the terms of the 1951 UN convention on the status of refugees. We are taking our obligations extremely seriously. I fear that eventually many may not qualify as refugees under the terms of the convention but that is because they are not fleeing individual persecution. The best work that we can do is to bring about the ceasefire and help it to hold and to allow those people to return to their own homes.
We have thoughts on longer-term repatriation and rehabilitation. I should like to leave those for another time when I have had a further discussion with Mrs. Ogata. I have already spoken twice with her about these issues. I believe that all the work we need to do must be done in close conjunction with UNHCR, the ICRC, the UN Security Council, the political reporters to the United Nations Secretary General and with the commission led by my noble friend Lord Carrington.
We have some knowledge of the pink zones about which the noble Lord, Lord Hylton, asked. Yesterday the United Nations Security Council adopted Resolution No. 762. It provides for the establishment under UN auspices of a joint commission to oversee the restoration of Croatian authority in those zones. But difficulties may follow. The UN observers would monitor the withdrawal of all armed units from those pink zones and retain a presence along the line of confrontation. In addition, the UN civilian police would monitor the maintenance of law and order in those zones, with particular regard to minority groups as has been the case in the UN protected areas.
The situation in the former Yugoslavia will be discussed day by day in the UN. The European Community will discuss the matter formally at the next Foreign Affairs Council on 20th July. But the working group is in session each week and the political committee continues to discuss matters daily. As issues arise, we shall deal with them.

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Your Lordships will see from what has been said in this debate that, while the situation is grave, it is one in which we are determined to help and to bring relief. Looking to the future, I know that resettlement and rehabilitation of displaced persons back in their own homes is what they desire most. That will take time and resources but we must be truly grateful to LINHCR, ICRC and the many other organisations for the work that they are doing. We must do all we can to help the different elements of the international
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community rise to the challenge and meet the humanitarian needs of the people of the former Yugoslavia.

Leeds Supertram Bill
Brought from the Commons; read a first time, and referred to the Examiners.
House adjourned at twenty-four minutes before ten o'clock.